Dear friends,
Americans are now paying record prices for gasoline and natural gas. Polling shows that most Americans believe Biden and his policies primarily caused this economic burden. Still, Biden now says "Russia's responsible" for our high prices, and there is nothing that he can do about it.
Oil and gas are global commodities and, of course, prices were affected by the war. But consider this: On Jan. 20, 2021, the day of the inauguration, the average cost of gasoline in the U.S. was $2.37. On the day before Russia invaded, Feb. 23, 2020, the average gas price was $3.53. Prices were up 50 percent under Biden even before the invasion.
This shouldn't come as a surprise to the American voter. Remember that the promise to end fossil fuels formed a cornerstone of Biden's primary campaign, and he repeated it often. "We would make sure it's eliminated ⦠No more fossil fuels." He told one voter on the campaign trail, "I want you to look in my eyes. I guarantee you, I guarantee you we're going to end fossil fuel." A supporter in Iowa started to ask him a few days before the Iowa caucuses, "What about, say, stopping fracking and stopping pipelines and..." Biden jumped in before she could even finish her question: "Yes, yes, no pipelines, exactly."
Now, in an election year, and with Americans naturally upset about the energy price, the administration deflects and blames others while cozying up to Venezuela and Iran to seek more energy supply. U.S. Oil & Gas Association President Tim Stewart made this pithy statement on this policy direction: "It's very insulting to us that we look at Venezuela to increase oil production. The country of Venezuela today produces 800,000 barrels of oil a day. The state of North Dakota produces 1.1 million."
The Biden administration also blames U.S. producers for not developing 9,000 leases – we can't develop leases if permits are not approved.
Data from the Department of Interior shows that the Biden administration continues its war against U.S. oil and gas companies. The government is delaying permit approvals despite the rhetoric of President Biden and Jen Psaki that the administration has done nothing to affect lower U.S. oil output. However, the Bureau of Land Management is approving fewer permits to drill and taking longer to process a permit.
Band-Aids are being offered to fix gaping wounds. Restarting the Keystone XL pipeline is more affordable and would lower gas prices. Releases from the Strategic Petroleum Reserve will only have a fleeting, temporary effect on prices. Some politicians are suggesting a gasoline-tax holiday. At least with the tax holiday, people get to keep their own money. Some Democrats have even proposed monthly gas stimulus checks to combat high gas prices. Giving away what is perceived as "free" money is a cheap election-year tactic.
The Biden administration is engaging in a PR campaign claiming that they are not suppressing oil production. This rhetoric is a classic case of gaslighting. We have covered a plethora of actions this administration has taken to discourage domestic production. Recently announced was yet another attack on oil production: a set of SEC "climate-related disclosure" rules designed to prevent oil investment and production.
The administration recently said they would begin the leasing process again on federal lands. This action is the latest in a string of stops and starts in the federal oil and gas leasing program since Biden took office, so forgive my doubts. They only announced this after a court ruling that temporarily restored a measure meant to factor the cost of global warming into federal decision-making. Actions will prove louder than words.
The U.S. has pledged more natural gas for Europe. Committing to more natural gas sounds excellent, but looking at the numbers makes the pledge hollow. The E.U. imported a record 22 billion cubic meters of LNG from the U.S. last year. The commitment aims to boost U.S. exports, yes; however, the U.S. is currently on pace to reach that target by a wide margin for the entire year. LNG export capacity was already projected to grow another 20 percent by year-end. Promising to do something that's happening isn't much of a promise.
Even as he was pledging more natural gas for Europe, in the same speech, Biden said the gas crisis is an "opportunity" to "double down on clean energy goals." This goal is his end game today – just as it was on the campaign trail.
We can fix this. The U.S. private sector provides smart solutions and actual results. As demand continues to grow, so does our current and planned production. U.S. oil production increased last year, and output could rise as much as 900,000 barrels per day in 2022. In the Permian Basin, our most prolific oil-producing basin, record-high oil production was just reached in March. The Marcellus, the most prolific natural gas basin in the country, is also at record-high production. We can build a better future.
The consequences of failure are too significant, especially the impact on our children and grandchildren. With the right policies in place, the U.S. could quickly become energy independent again, with an environmentally friendly approach. Domestic production supports national and economic security, yes. Domestic production even has a positive impact on global environmental goals. Our production is far better for the environment than the production in Venezuela or Russia. It will help end our global dependence and improve the quality of life for us and our allies.
In this issue of BIC, we feature insight from Arkema Inc. President and CEO Anthony O'Donovan, LyondellBasell Edison Plant Site Leader Armando Lara, GATE Energy President of Commissioning Mark Myhre, Taurus Industrial Group COO Hari Gopu, Wood President of Operations -- Americas Paul Leonard, and Lake Area Industry Alliance Executive Director Jim Rock. We also cover important topics for your business, including strategies for breaking down communication silos, how true leadership recognizes responsibility to community, and ensuring quality for bio-diesel and renewable diesel.
The great American statesman Daniel Webster, who represented two different states in the U.S. Congress and served as the U.S. Secretary of State under three presidents, had this thought on prioritizing American resources to promote our interests: "Let us develop the resources of our land, call forth its powers, build up its institutions, promote all its great interests, and see whether we also, in our day and generation, may not perform something worthy to be remembered.
