The great thing about our freedom-based economic system is that the government doesn’t have to do much at all in order for the people to prosper and the economy to grow. Just sit back and watch the people create businesses, put each other to work, and provide for every imaginable human need.
But we now have a government in the hands of people who hate America and hate its freedom-based system. The current administration is actively working to undermine the American economy and advance the interests of our geopolitical adversaries. In no area is this more true than the field of energy. In this field, the Biden Administration came in with the explicit goal of undermining American energy production. Indeed if an administration wanted to undermine American energy prosperity as much as possible and comparably benefit our adversaries, it is difficult to think of anything it would do different from what the Biden Administration is doing.
During most of my adult life, “energy independence” has been a bipartisan goal throughout the federal government. That goal was actually achieved under President Trump. Within just a few months, Biden has undone that achievement. The administration has made no secret of its goals to reduce U.S. energy production of the things that work (i.e., fossil fuels) and to drive up their price. Let’s just make a small list of key actions in furtherance of those goals:
- On his first day in office, Biden revoked the permit for the Keystone XL pipeline, intended to bring some 800,000 barrels of crude oil per day from Canada into the U.S.
- The next day, Biden suspended all permitting of oil and gas drilling on federal lands and waters.
- Biden’s EPA then set in motion the reversal of Trump Administration loosening of rules on methane emissions in the process of producing oil and gas. These tightened Biden restrictions have the effect of increasing the cost of production.
- Currently in the works are rules from the SEC to require extensive new disclosures by energy producers (and others) of supposed “climate”-related risks.
These are just examples of an overall hostility to fossil fuel energy development, specifically intended to have the effect of making energy projects more difficult and more expensive to develop. And so far, the government’s actions are rapidly accomplishing their intended goals:
- The price of a barrel of WTI crude oil has jumped from $53.30 on January 20 (Inauguration Day) to $74.56 yesterday. Crude oil prices are currently at a six year high.
- The average price of a gallon of gasoline at the pump has risen from $2.42 in January 2021 to $3.17 in June, according to EIA data.
OPEC members and Russia are the obvious candidates to step in to take advantage of the price increases, but it seems that those parties are currently having some kind of stand-off as to who gets how much of a quota when production goes up. From the Wall Street Journal, July 6:
[A] squabble between Saudi Arabia and the United Arab Emirates over quotas is blocking an agreement [to lift production].
Do you think that a competent American administration might want to see American production go up at such a time? Wrong:
A White House spokesperson on Monday said it is urging OPEC and its allies [including Russia] to quickly come up with a compromise “that will allow proposed production increases to move forward.” The Administration is worried that higher gas prices could undermine Mr. Biden’s climate agenda and spending plans.
In lieu of energy independence, we are now seeing imports from Russia reach highs not seen for ten years. From S&P Global, April 16:
Imports of Russian oil, which consists mainly of fuel oil feedstocks and some crude, recently reached a 10-year high as US refineries continue to ramp up runs as the economy starts to recover from COVID-19. Russian oil imports as a share of US total oil imports hit a record high of 8% in January 2021, according to data from the US Energy Information Administration, up from 4% during 2018.
It’s hard to imagine a more counter-productive set of policies than what the Biden Administration is implementing under the rubric of supposedly “fighting climate change.”