The Killing of Qassem Soleimani and the Dog That Didn’t Bark

“The Adventure of Sliver Blaze,” one of the most popular Sherlock Holmes stories, involves the theft of a famous race horse, Silver Blaze, and the killing of its trainer, just before an important racer.  In a conversation with a Scotland Yard detective, Sherlock Holmes explains a key clue:

“Gregory: Is there any other point to which you would wish to draw my attention?
Holmes: To the curious incident of the dog in the night-time.
Gregory: The dog did nothing in the night-time.
Holmes: That was the curious incident.”

This was the famous “dog that didn’t bark.”  Which brings me to “the dog that didn’t bark” in the killing of Iranian Revolutionary Guard General Qassem Soleimani.  Ever since the 1970s, whenever there was a crisis in the Middle East, the price of oil would go up – a lot.  At times, it seemed like the price of oil would go up if King of Saudi Arabia had the sniffles.  But what happened when Qassem Soleimani was killed?  What happened was that the dog didn’t bark.  The price of oil went up a little less than five percent for a couple of days, but then it went back down to where it was before General Soleimani was killed.

Gillian Tett of the Financial Times says that “[t]oday’s US economy is far less vulnerable to swings in the oil price – and Middle Eastern shocks” because of “a big structural shift that Mr Trump loves to trumpet: America’s homegrown energy boom. … The change largely stems from shale oilfields”; i.e., fracking.¹  In 2010, America produced five million barrels of oil a day.  It now produces twelve million.

But Ms. Tett gets one thing wrong when she says the US economy is far less vulnerable to Middle Eastern oil shocks because of fracking.  As the Financial Times itself said a couple of days before Ms. Tett’s column, it is incorrect to say, as President Trump does, that the US produces so much energy that it is independent of the world oil market.  The oil market is not country-by-country.  It is international.²

So while the US is still subject to the world oil market, the huge increase in the US production of oil means that the world oil market, not just the US oil market, is far less vulnerable to Middle Eastern shocks – and all countries, not just the United States are either not subject, or at least less subject, to political blackmail because of dependence on oil from countries that are not nice.

Interestingly, if Democrats like those running for president this year, who want to ban fracking, were in charge, or if the policies of countries like Germany or England, which have banned or effectively banned fracking, applied all over the world, the world would still have to kowtow to Middle Eastern oil sheiks and the likes of Vladimir Putin.³

But because of American ingenuity and free markets (and because the Obama administration did not get in the way of fracking as much as current Democrats say they will), we don’t have to do that anymore.  Last March, Deputy Energy Secretary Dan Brouillette said that fracking “allowed the president to make foreign-policy decision that simply were not available to previous presidents.”

But it’s not just the United States that has that freedom.  The shale oil (and gas) boom gives everybody the freedom to do what they think is right in foreign policy, as opposed to what they think they have to do to keep their access to oil.

I understand the world is not going to thank American frackers and American ingenuity.  But they could at least acknowledge the fact that American ingenuity and free markets have lessened the world’s dependence on countries like Saudi Arabia, Iran, and Russia.
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¹ Gillian Tett, “Why America has less to fear from an oil shock,” Financial Times, January 10, 2020.
² “American cannot escape oil price volatility,” Financial Times, January 6, 2020.
³ While a Democratic president might not use that freedom to make the same foreign policy decisions as President Trump does, one would think they would like the freedom to make the decisions they think best without having to sorry about what some Middle Eastern sheikh thinks of our decision.