The Cold Reality of Abandoning Russian Gas - The American Spectator | USA News and Politics
The Cold Reality of Abandoning Russian Gas
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Last October, The American Spectator ran my op-ed declaring that “Putin Has NATO Over a Barrel.” It lamented the precarious position of Europe and the U.S. national security, caused by energy policies intent on total decarbonization. The unintended consequence of these policies, caused by unreliable renewable-energy technology, was the fostering of increased reliance on imports of Russian liquid natural gas and petroleum. Now that war has broken out in Ukraine, NATO is placing economic sanctions on Putin. The Biden administration announced Tuesday that it will join the UK in banning oil imports from Russia. But just how costly will it be to disentangle America’s grid from the Kremlin?

In that press conference, the president claimed, “It is simply not true that my administration or policies are holding back domestic energy production…. Even amid the pandemic, companies in the U.S. pumped more oil during my first year in office than they did during my predecessor’s first year.”

But that claim is misleading, for multiple reasons. First, most oil pipelines take between a year and two years to come online. After reversing the Obama administration’s hostile attitudes toward fracking, President Trump with his plan to repatriate American oil manufacturing went on to achieve national energy independence for the first time since President Nixon set the target. In a move that perplexed Paris Accord members, repatriation made America the leading nation in annual emissions reduction in 2019. From the first week of the Biden administration, daily averages of crude oil production have fallen by almost 4,000 barrels.

This followed three pieces of anti-fossil-fuels legislation passed from day two of Biden’s presidency. The first, the “Executive Order on Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis,” ceased construction of the Keystone XL Pipeline — a project made a focal point of contention between the Obama administration, which stopped it, and the Trump administration, which reopened it, avoiding a $15 billion lawsuit from the contracted company seeking damages for the cancellation. The pipeline was fully funded, and, though only 8 percent complete, would have transported over 800,000 barrels daily from Alberta to Texas refineries and provided thousands of jobs.

The second, Secretarial Order No. 3395, constituted a 60-day moratorium on leases for the expansion of the 22 percent of oil production and 12 percent of natural gas production conducted on federal land. This crippled production in states such as Utah, where over half of land is federally owned. The moratorium was extended indefinitely by the “Executive Order on Tackling the Climate Crisis at Home and Abroad.” This legislation passed despite the Biden–Harris campaign promise not to ban fracking.

In 2020, the Institute for Energy Research found further anti-fracking action could double oil prices to $130 per barrel, quadruple electricity prices, reduce gross domestic product (GDP) by $7.1 trillion, and induce another major recession. On Monday, price per barrel passed $130, with Putin threatening to constrict supply until it doubles to $300.

It appears the Biden administration would rather swap one adversarial supplier for another than reverse the policies that took the wind out of domestic gas manufacturing.

The knock-on effect is that America is dipping into global supplies more than before — and is thus subjected to the fluctuating global gas market. In 2021, U.S. oil production decreased by 14 percent, and prices increased 65 percent compared to pre-pandemic levels. Crude oil imports from Russia to the U.S. reached a record 26,000 barrels in May 2021 — between 5–10 percent of annual supply. Imports have fallen since, but global gas price rises mean domestic petroleum costs remain high. At this writing, average rates are just shy of the all-time high of $4.11. To ease the then-7 percent increase in global crude prices, Biden pledged in his State of the Union address last week that 30 million more barrels would be released from the Strategic Petroleum Reserves. But this constituted less than two days’ worth of national consumption. The once-scoffed-at $7.00-a-gallon figure that President Trump predicted would be reached under Biden is becoming reality in California.

With inflation caused by the $120 billion of quantitative easing conducted monthly by the Federal Reserve during the pandemic now plundering paychecks, families may be horrified to hear of a coming food shortage. Wheat and cereal prices have hit 14-year highs. Ammonia production costs tripled in price last year. The fact that Russia is now a leading global exporter of nitrogen and phosphorus compounds existing supply issues for fertilizer ingredients. Belarusian potash was also sanctioned by the EU and United States. And farmland shortages have been produced by mass buyouts and conversion of acres to produce biofuel crops (which also require fertilizer) to replace the natural gas no longer being extracted.

Immobility, empty bellies, and cold hearths are the products of relying on Russian petroleum.

To complicate things further, the guillotine of future fossil fuel lawsuits hangs overhead. This Pandora’s box was opened by America’s potential re-entrance into the Trans-Pacific Partnership. The trade pact’s Investor State Dispute Settlement Provisions mandate the purchasing of certain goods from member states — making the prospect of phasing out fossil fuels a financial minefield fraught with litigation potential. Taxpayers could foot a multi-billion-dollar bill for cancelling oil and gas procurement contracts.

But arguments for energy independence are gaining ground against Biden’s carbon emissions abolition agenda.

Republicans have consistently called for bans on Russian gas imports. But the Democrat establishment breaks with GOP lawmakers on the suggestion that a reinvigoration of domestic production could make up for the shortfall. At loggerheads with Republicans on other issues ahead of the midterms, the Biden administration seek instead to make unlikely bedfellows in its pursuit of securing alternative exports.

Saudi Arabia has refused to release oil reserves — a feat President Trump strong-armed them into stopping when negotiating OPEC out of a price war. Snubbed by the Saudis for a second time, President Biden is looking elsewhere in the Middle East for aid.

This week, he seeks to renegotiate the $400-million-plus Obama-era Iran Nuclear Deal, to re-secure oil prospectors’ faith in a restabilized regional market. Said deal did not prevent Iran assembling a nuclear weapon; nor will Russian intervention in brokering this version lower international tensions.

Sanctions on Venezuela may also be eased in order to secure some of the chief exports by the socialist petro-state. This idea has drawn bipartisan criticism for allowing the “cancer” of Maduro’s “reign of torture and murder” to continue to fester south of the border.

It appears the Biden administration would rather swap one adversarial supplier for another than reverse the policies that took the wind out of domestic gas manufacturing.

Reversing oil and gas exploration bans and reforming EPA requirements will not be a quick fix for the global gas price crisis. But, with NATO nations working in concert to secure their individual energy independence, these actions would stabilize and safeguard the market against future fluctuations. The Ukrainian invasion and its resulting resource complications should serve as a lesson that energy security is a national security issue. Biden’s dreams of rapid decarbonization need to be shelved so that everyday Americans can heat and eat affordably again.

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