Milot’s Musings: Oil Politics

Published 10:04 am Sunday, March 13, 2022

On March 3rd at 11.25 a.m. EST, President Biden stood in the Roosevelt Room of the White House to deliver a speech to the American people.

It was an important speech in which he announced that he had decided to bar imports of oil from Russia.

He took time to explain why—although not why it had taken him so long to make that decision after 70% of the country, even Nancy Pelosi, clamored for him to do it.

The president should have stopped there and called it a victory for righteousness. He clearly was doing his part to deny Putin the use of fossil fuels as a weapon. But he didn’t stop there. Obviously stinging from criticism that his energy policies are to blame for soaring gas prices, he just had to take this opportunity to push back. He looked straight at the camera and lied.

Here’s the big whopper: “It’s simply not true that my administration or policies are holding back domestic energy production. That’s simply not true.”

Let’s see. On his very first day in office, the new president declared war on fossil fuels by cancelling leases for drilling on public lands and ANWAR, imposing onerous regulations on the drilling of new wells, and putting a stop to the Keystone XL pipeline.

That’s a truth the president can’t deny.

Then, to further demonize fossil fuels, Biden sent Vice-President “Giggles” Harris and mental midget Pete Buttigieg out to lecture the motoring public on the solution to reducing harmful emissions: Replace your gas-guzzlers with electric vehicles only the rich can afford.

Meanwhile, Treasury Secretary Janet Yellen asked banks and money managers not to provide the capital oil producers need to expand operations. This is a critical point. Oil companies need capital. And if Biden continues to wage war on public and private financing of oil drilling while subsidizing green energy plans, oil companies have little incentive to make long-term investments.

Moreover, the cost of drilling new wells has gone up dramatically because Biden’s inflation is pricing new oil production out of
the market.

The fact remains that domestic oil production is down 8% from what it was in 2019. And as long as President Biden continues his war on fossil fuels, there is little prospect of returning this country to the energy independence enjoyed under President Trump.
Biden has no choice but to look elsewhere.

Maybe it is time to ask Saudi Arabia to pump more oil. But the last time Biden asked (begged) Mohammed bin Salman to open the spigots, the prince said no.

Now he won’t even take the president’s call. Maybe the prince is still sore at Biden for saying at the 2020 presidential debates that “there is very little redeeming value in the present government of Saudi Arabia.” Jen Psaki didn’t help recently when she said that Saudi Arabia should be treated like a pariah state, and that its leadership had little redeeming value. This is hardly the way to make friends and influence people.

Then came an unexpected gift. The UAE (United Arab Emirates), an OPEC member like Saudi Arabia, announced that it would increase its oil production. Markets went wild, as the price of oil on the world market fell $13.20 from its high of $112.10. But the joy has proven to be “transitory,” to use one of the administration’s favorite words.

Now we have to endure the humiliation of having to negotiate with perennial enemies Iran and Venezuela for more of their oil.

What was that you were saying about not holding back domestic energy production, Mr. President?

A longtime columnist published in many newspapers, Claude Milot is a retired publishing executive who can be reched at cmilot@embarqmail.com