The American Economy Is Being Challenged Like Never Before

The American economy is being challenged to a war, but probably not the way you think. I'm not talking about a world war, and I'm also not talking about a trade war. I'm talking about the war over oil, which is quietly starting to accelerate. And the reason you want to pay attention is because it can impact gas prices, stock prices, and our economy at large. What do I mean? It's OPEC versus United States oil companies fighting over who will control the world's oil. And if you have no idea what that means, don't worry. I'm going to break it all down in this video, starting by explaining what is OPEC versus US shale. Number two, explaining what's happening in this oil war right now. Then going into number three, why this is so important because of how oil can equal power. Number four, the risks of everything going on in the oil war. And then number five, how does this affect you and where's the opportunity for you? So let's break this down. Let's start with the basics. OPEC is a group of oil producing companies like Saudi Arabia and Russia. And the reason why this is so significant is because they control 40% of the world's oil supply. And then we have US shale. This is where American companies are doing fracking, meaning they're digging deep into the earth, pulling out oil from rocks underground. And this is where things get interesting because over the last 10 years, US shale has been giving a lot of competition to OPEC. And businesses don't like competition. And this is where we're starting to see OPEC fight back in 2025. For example, in May 2025, OPEC really started to increase the supply of oil that they're producing. And this now ties in very nicely to number two, which is what's happening right now. So OPEC is increasing the supply of oil. Why would they do that? Well, let's think about supply and demand. When you have more supply and the same amount of demand, generally the prices of things go down because now there's a lot of stuff you can buy and not that many buyers. But why would they want the prices of oil to go down? Well, let's think about it this way. Do you remember about 10 years or so ago when Uber was first getting started, they were offering everybody cheap rides and free incentives to get you to want to use an Uber? Why? Because when they did that, it was cheaper for you to use an Uber than it was to use a taxi. Then when they got you an Uber, well, you didn't want to leave. And that meant taxis were making less money, which kind of pushed them out of the market. So if a company can offer a lower price, even at a loss, they can start to push out their competition. That's exactly what OPEC is trying to do here. OPEC is trying to make it more difficult for US shale providers to stay profitable. This has been driving down the price of a barrel of oil, which is making some oil companies in the United States suffer. This is from the New York Times. After two months of crude oil prices hovering around $60 a barrel, companies are shutting down drilling rigs and laying off workers as they pair spending. It now appears very likely that US oil production will not grow much this year, if at all. Again, the reason why this is important for you to understand is because this can impact gas prices, food prices, inflation, and just the general economy, not to mention the stock market as well. By the way, yes, we've been covering all of this in Market Briefs. Again, Market Briefs is my free financial newsletter for investors, where every day my team is working to break down what's happening in things like the economy, the global economy, stocks, housing, and crypto into a fun, witty, and easy to read newsletter. We have hundreds of thousands of investors that are reading Market Briefs every morning. Plus, when you join Market Briefs, you'll also get my investing masterclass. We'll walk you through how you can get started as an investor and how you can find big investment opportunities before everybody else. It's completely free. So if you want to get Market Briefs and the investing masterclass all for free, all you have to do is click the link down in the description below. So what's happening right now is we have OPEC trying to produce more oil to bring down the prices of oil, which then is causing US shale companies to get hurt. But the real reason you want to pay attention to this isn't just because of profits. It also has to do because of power. Every economy needs oil. So whenever you hear economic discussions about oil, you have to think money plus power. And right now, Saudi Arabia and Russia are working to weaken the US shale providers by trying to pump more oil into the markets. And this isn't the first time that we've seen this happen. If we go back to 2014, Saudi Arabia was pumping the market with oil, which caused oil prices to crash and it caused US shale providers to also slow down their businesses. That's less jobs in the United States, that hurts the United States stocks, and that's also less profits for the United States. The difference between then and now is US shale producers are more efficient and more lean today. That means OPEC, these foreign countries, have to drive down prices even more to create a further impact to US companies. And it is having an impact on the United States economy. We've seen oil drilling slow down in the United States. Investments are being cut and oil companies are also laying workers off. Now, in case you're wondering, yes, we are seeing more alternative energy sources pop up around the world. But right now, the world still operates on oil and OPEC is playing a chess game trying to push some of the US producers out. That way they can make bigger profits in the long run. But now let's dig a little bit deeper into the numbers and talk about the risks. American shale oil is expensive, which means a barrel of oil has to sell for $65 to $70 just to break even. And just a few weeks ago, a barrel of oil was selling for around $60, which meant that oil producers, shale producers in the United States were working to produce oil, but they were losing money for every barrel of oil that they produced. And this is the reason why United States companies have been cutting back on production. And it's the same reason why we have the lowest number of oil rigs since 2021. Now, OPEC's goal of reducing oil prices is not to sell oil cheap forever. It's to push more of these companies out of business. That way then OPEC can then raise prices and keep the profits for themselves by having a bigger market share of the oil industry. But do you want to know the most interesting part? They are bleeding more than the United States. According to Saudi Arabia data, the Saudi Arabian government needs to sell oil at around $90 a barrel to balance out their national budget. And Russia needs to price their oil at around $77 a barrel in order to avoid fiscal deficits. So yes, absolutely producing more oil hurts the United States companies. We've already established that. But it also hurts the OPEC companies as well because they want to sell oil for way more than $90 a barrel. They just want to have more of the market share. But the question is, how long will they keep going to squeeze out these companies before they start to feel the pain as well? Now, I should also point out a big economic difference between this and this, where United States shale companies are generally private companies versus Saudi Arabian companies. Yes, some of them are private, but some of them are also owned by the government, which allows them to kind of float different types of losses than a private company. To mention the fact that at the same time the supply of oil is increasing, we're also seeing a slowing demand for oil, according to OPEC, partially due to trade tensions around the world. That means if the demand for oil continues to drop while OPEC is working to increase its supply of oil, it could end up backfiring if things get more costly than expected. And this is where I want to highlight one more time that oil is more than just about money and profits. It's also about power. Because if we go back a few years ago, when we saw gas prices hit $5, $6, $7 a gallon, people in the United States were freaking out, for lack of a better word, and it created a lot of economic stress and uncertainty. Well, part of that stress and uncertainty can be caused not just by United States companies, but it can also be influenced by what's happening here if the United States does not have control over their own oil or they're heavily reliant on foreign oil companies, which can then dictate the supply and price of oil. And for full transparency, we've seen energy be used as a weapon in the past. Take a look. I mean, you might remember not that long ago when Russia cut off energy supplies to Europe, which created blackouts around the country. It forced Germany to restart their coal plants just to survive winter, and it also forced China to start building their own energy reserves to prepare for global uncertainty. That's the reason why this is so important. Because oil, yes, it's a commodity. Yes, some companies make profits. Yes, there's competition. We've seen that happen in every single industry in the world. Nothing new about that. But the reason why oil is so interesting is because not only does oil have to do with money, but it also has to do with power, and it can be used as some sort of economic warfare. And now that you have a better understanding of what's happening in the oil world with all the risks involved, let me talk about what this means for you. Because if we get right into it, at the end of the day, you can't change the geopolitical system, but you can change how you use your money. Now, in the short term, we know the United States shale producers are probably going to get hurt as long as OPEC continues to increase supply, because that's going to hurt the price of oil per barrel, and that's going to make it difficult for United States shale producers to make a profit. But we don't know how long it's going to last. And it could also potentially create an opportunity, assuming that you're investing into an industry that does not go bankrupt. And this is where you want to think about this as an investor. Could you find a potential investment opportunity here? Could you find opportunity to invest for the long term? And do you know how to do that research? This is where I want you to start thinking like an investor, because we know that OPEC wants more power, and we know that the United States doesn't want to lose that power. How is it going to play out? We don't know. But if you're an investor, this could be something that maybe you want to pay attention to. Now, again, I can't give you financial advice because I'm just a random guy on YouTube. My job is to help you start thinking like an investor, that way you can find opportunities that might be unique for you. Now, I want to just make sure that we understand this. Not everybody. In fact, most people shouldn't be investing in individual companies. My belief is that most people should just be index investing. Your dollar cost average, I call it ABB, always be buying, investing into ETFs, broad basket ETFs, maybe something like the S&P 500. Again, I can't tell you what to invest in, just an example. But some of you are going to be a little bit more sophisticated that want to find more of those new and unique opportunities. I call this market shifts. And this is where you have to understand what's happening in the economy. Again, Market Briefs is a free resource to help you stay on top of what's happening. For those of you that want more, my team at Briefs Pro publishes a weekly report where we break down shifts that are happening in the economy. So if things like this are interesting to you with stocks that are related to it, again, you can check out Briefs Pro. But that's for, again, active investors that want to be more involved and want to know where the money is moving. So now that you understand what's happening in the oil world, what do you think is going to happen? Do you think that OPEC is going to continue pumping the market with more oil? Or do you think they're going to pull back and the prices of oils are going to rise and that's going to benefit U.S. shale companies? I'd love to hear your thoughts because a lot of things can happen. Let me know down in the comments. I'm looking forward to reading what you have to say. I would love for you to share first, how do you think that institutions profit from our financial uneducation? Well, I think the system, our economic system is designed to keep the majority of people poor. After learning about how money works, you start to see why certain things work the way that they do. I'll explain exactly what I mean.