By EDWARD CROSS
Kansas Independent Oil & Gas Association
We all feel the effects of rising energy prices. The Russian invasion of Ukraine only adds to our energy concerns and heightens the importance of the role of U.S. energy policy.
European countries are starting to realize their fears about energy access and affordability with the breakout of conflict in Ukraine. Broadly similar to green new deal style policies, the European Union (EU) has been cutting off their own fossil fuel production and usage without a viable alternative to meet that baseline demand. With their domestic sources waning, Russia stepped in to meet that demand. Now that Russian supply is threatened, renewable sources are not able to meet demand and energy prices continue to increase sharply across the continent.
The lesson learned from Europe is that renewable energy sources are not ready to meet national energy demand. Over-reliance on renewable energy and Russian gas has been a recipe for disaster for the EU. President Biden should heed this as a warning of what his energy agenda will bring if he continues his war on American oil and gas.
Americans had fairly stable energy prices in 2017-2019, and fairly low ones, in part due to the tremendous increase in energy production in the United States – both oil and natural gas. In 2018, the U.S. produced 95% of its domestic energy requirements, the largest share since 1967. Gas prices, the marker Americans watch almost to the exclusion of everything else, averaged $2.60/gal in 2019, 4% lower than in 2018.
Here’s a key point: when a country becomes the leading producer of oil and natural gas and has reduced CO2 emissions by 70% in 10 years, it is clearly doing many things right.
The Biden Administration need look no further than their own actions to find the primary reason energy prices have escalated since he took office. First, a pipeline bringing oil from Canada to the U.S. was quickly cancelled. Then, new leasing for energy development on federal acreage was stopped. Added to that was a batch of proposed punitive, unnecessary, and burdensome regulations on oil and gas operations. These actions have severely hampered American oil and gas companies’ ability to adequately supply the market and have put American Energy Independence at risk. These are short-sighted energy policies that result in higher energy costs that disproportionately harm low-income groups.
U.S. energy policies that restrict domestic production force our country to seek relief from foreign suppliers of energy, undermining our energy independence. The problem is that when certain foreign governments control your energy, they have the power to use it for their own purposes, not yours. America should not be in the position of asking for foreign energy supplies, especially when we have abundant resources produced to standards that are among the highest in the world, right here at home.
Instead, we should be leading. Energy should be a bipartisan priority. Nothing is more essential to economic growth than reliable, affordable and abundant energy. To lose that advantage is not in anybody’s best interest.
John Kerry, President Biden’s Special Presidential Envoy for Climate, is concerned that the war in Ukraine will distract attention away from the ‘climate crisis’. Unserious statements like those coming from Kerry and others in the Biden Administration are creating a geopolitical power vacuum. We might not be serious, but our enemies are ruthlessly so. They raise a toast to our self-inflicted demise. We are left with a simple choice in the U.S.: get serious about our energy policy and preserve our place in the geopolitical order or be forced to stop play-acting as a superpower.
It is time for President Biden to recognize the strategic importance of American energy production. He should abandon his quixotic energy strategy immediately. Senseless pandering to the green left has helped foster the very conditions that have given Vladimir Putin confidence that his war on Ukraine will be met with little resistance from the U.S.
While claiming to fight to bring energy prices down, President Biden has made the wrong move at every turn. Nothing less than a total reversal of his approach is necessary. This is the signal that President Biden needs to send to the world to stop the decline of American energy security. Certain times require a re-evaluation of priorities and a reorganization of values. The global crisis that Putin has set in motion is such a moment.
Putin tends to lash out when energy prices are high. Lowering these costs will not be easy. It will take time. And the only effective means of lowering the price of energy is increasing its supply.
President Biden should embrace oil and gas exploration. If the U.S. is energy independent, then we don’t beg people in the Middle East or Russia to help us and Putin would not have the financial reserves to subsidize an invasion. America was energy independent just a few years ago. Biden should do everything he can to make us energy independent again.
President Biden and all federal and state policymakers should prioritize advancing American energy leadership with policies that encourage development of responsibly produced energy here at home. These policies should recognize the volatile world we live in and the long-term impacts of returning to the days of foreign energy dependency.
Edward Cross is president of the Kansas Independent Oil & Gas Association.