Biden’s begging oil companies to produce — while wanting to bankrupt them


Doesn’t it seem like just yesterday Joe Biden was running for president promising that he would practically hit energy companies over the head with a two-by-four if they kept producing so much “dirty” gas and oil?

His energy plan was to drive oil and gas out of the market by switching to solar, wind and other “green energy.” He even nominated a federal regulator who said she wanted to “bankrupt the oil companies.”

But this week he’s saying he’ll practically call in the army and Marines and invade the executive offices of “Big Oil” if they don’t start producing more oil and gas.

Well, which is it, Mr. President? Do you want more or less oil? 

Candidate Biden famously agreed in a presidential debate he would “close down” the oil companies. And just in case they didn’t get the message, his first executive order as president was to kill the Keystone XL pipeline. That was critical energy infrastructure to bring oil and gas to markets swiftly and safely.

The Institute for Energy Research counts 100 other initiatives since then — from drilling moratoriums to environmental roadblocks — to stop American oil and gas development.

Gas station
Gas prices have risen nationwide over the past few months.
dpa/picture alliance via Getty I

What has been the effect on US energy production? Under President Donald Trump, we reached 12 million barrels a day — by January 2021, we were a net exporter of oil and gas — and the price fell to $2.49 a gallon. Now we’re at only 11 million barrels a day — even though the national average has doubled to $5.05 a gallon. The Energy Information Administration predicted we’d get to 15 million barrels a day by 2023. We’re running at least 2 million barrels a day lower than trend, costing the US economy almost $300 million a day in lost output.

Voters are mighty angry at paying $70 to fill ’er up, so Biden is blaming oil companies (along with Russian President Vladimir Putin) for the price hikes his own policies created. And he’s suddenly demanding they open up the spigots.

Biden just fired off menacing letters to the heads of ExxonMobil, Chevron, Shell, Phillips 66 and other oil giants. Sounding like a Mafioso boss, he demanded they take “immediate actions to increase the supply of gasoline, diesel and other refined product” and threatened to invoke emergency powers to boost output. “Your companies need to work with my Administration to bring forward concrete, near-term solutions that address the crisis and respect the critical equities of energy workers and fence-line communities.”

Even when he’s admitting fossil fuels are essential, Biden can’t lay off the progressive agenda. The “equities of energy workers” have nothing to do with getting gas prices down — and it’s rich to feign concern about those living near refineries while insisting they up production.

Team Biden clearly doesn’t understand how the market works. “When the White House started calling around in a panic, they thought shale oil production could grow sharply in the near term — like in a matter of months or quarters,” Rapidan Energy chief Bob McNally told the Financial Times. “They were shocked to learn that that’s like asking for blood from a stone. It’s almost impossible.”

Keystone pipeline
One of Biden’s first actions as president was to nix the highly-controversial Keystone XL pipeline.
AFP via Getty Images

Let’s talk about refining capacity. Biden says we must rapidly increase it, and he’s right. But refineries are about to reach 95% capacity — they can’t go much further overnight. For 25 years the industry has been pleading for more refineries, and the environmentalists in front of whom Biden genuflects have killed nearly every proposed refinery and liquefied natural gas terminal.

When Washington reduces supply, prices go up — period. And Biden’s billions in giveaways to green energy and electric cars and his war on oil have discouraged oil companies from trying to ramp up. They also know he’ll resume hostilities once this crisis ends.

Biden complains oil companies are making “windfall profits,” and there’s chatter about slapping more taxes on them. Never mind that they did badly during the pandemic, with ExxonMobil’s stock a third of what it is now. Biden never talked of giving them a bailout. As Exxon noted in response to Biden’s letter, “We kept investing even during the pandemic, when we lost more than $20 billion and had to borrow more than $30 billion to maintain investment to increase capacity to be ready for post-pandemic demand.”

The obvious solution to Biden’s self-created energy crisis is a responsible and environmentally sensitive drill-baby-drill policy. Don’t hold your breath because the Biden master plan is still to eliminate all oil and gas consumption over the next 30 years. Despite his demands, we could be looking at years of $4 to $5 gasoline.   

Stephen Moore is a senior fellow at the Heritage Foundation, senior economist at FreedomWorks and author of “Fueling Freedom: Exposing the Mad War on American Energy.”



Source link

Comments are closed.