Source: World Oil
For several months now, we have told you our concerns about a potential Joe Biden presidency, as relates to the oil and gas industry’s future. And in those statements, we have pointed out that it is not just Biden that one has to be concerned about, but also the radical leftists behind him, who make up a growing share of “his” Democrat Party.
The key excerpt. But now, after his presidential debate performance last night (Thursday night) against incumbent U.S. President Donald Trump, it is crystal clear—Joe Biden wants to get rid of the U.S. oil and gas (O&G) industry—totally. If you don’t believe it, consider this exchange between Trump and Biden, transcribed by The Tennessean newspaper (Nashville) and other sources:
Trump: Would you close down the oil industry?
Biden: I would transition from the oil industry. Yes.
Trump: Oh, transition. That’s a big statement.
(Moderator): Why would you do that?
Biden: Because the oil industry pollutes, significantly.
Biden did not support that last comment with any additional facts or statistics, and continued with a meandering statement as to why renewable energy has to replace oil and gas, and that the federal government needs to stop giving subsidies to the industry, while it supposedly fails to give to solar and wind. “We actually do give it to solar and wind,” countered Trump. Furthermore, Biden failed to mention that the U.S. O&G industry has made great strides toward “clean energy,” which refers to the clean production of these fossil fuels with little or no emissions.
Another excerpt. The discussion of energy in the debate continued with one more exchange, as follows:
Trump: That’s the biggest statement. In terms of business, that’s the biggest statement. Because basically what he’s saying is he’s going to destroy the oil industry. Will you remember that Texas? Will you remember that Pennsylvania? Oklahoma? Ohio?
Biden: He takes everything out of contact, but the point is, look we have to move toward net zero emissions. The first place to do that by the year 2025 in in energy production. By 2050, totally.
Inconvenient facts. But, as API noted in a post-debate release, “U.S. carbon dioxide emissions are at their lowest in a generation, and we’re continuing to see progress” (thanks to significant efforts by the oil and gas industry). “The [IEA] reported that the U.S. recorded the largest emissions decline of any country last year, down 140 million tons from the previous year.” But, of course, harking back to former Vice President Al Gore, these are “inconvenient truths” for Biden to mention.
Something else that Biden failed to mention, but which goes to the bottom line of every citizen’s household budget, is that his policy positions will increase the cost of all energy to all Americans. Despite his protestations to the contrary in the debate, Biden has been on record quite a few times, saying that he would end hydraulic fracturing. Of course, this means that without fracing available, the U.S. would produce significantly less oil, and be far less energy-independent than the net energy exporter status that it currently enjoys. Indeed, Continental Resources Chairman Harold Hamm said right before the debate that Biden’s plans for discouraging use of fossil fuels would “plunge America back into a depression, and could drive gasoline prices to $6/gal. Whether the price actually hits that level or $5, $5.50, $6.50 or $7, the point is that consumers would take a major hit.
Furthermore, Biden’s policies would require extensive reliance on wind and solar power, which are expensive to build, as well as synthetic and renewable fuel substitutes that are far from being in any meaningful development. Wind and solar are also expensive to maintain. If you have any doubts about this, consider what our Contributing Editor for Washington, Dr. Roger Bezdek, sent us about six weeks ago with regard to offshore wind power.
“The actual costs of offshore wind projects borne by electric ratepayers and taxpayers are likely to be greater than advertised,” said Dr. Bezdek. “Experience in Europe over the previous decade demonstrates that the performance of offshore wind turbines degrades rapidly—on average, 4.5% per year. As output declines and maintenance costs increase, project developers will have a growing economic incentive to abandon their projects before the end of their contracts to supply power. In contrast to the strict requirements for nuclear power plants, it is unclear whether offshore wind project owners will be required to set aside sufficient funds to decommission their facilities. This will likely mean that electricity ratepayers and state taxpayers will pay to decommission offshore wind turbines or pay higher prices to keep the projects operating.” In other words, he says, after 10 years, the average output of the newer offshore wind turbines will be just over half the initial output.
National security. Then, there are the national security implications of the Biden energy positions. Learning from past wars and other military operations, particularly World War II and the Persian Gulf War, where a plentiful, readily accessible supply of petroleum made a significant difference in success, the Trump administration has wisely encouraged the build-up of domestic production.
Indeed, the ability to implement foreign policy and wage military actions without fear of inadequate petroleum supplies has given the U.S. the ability to wield a big stick. Yet, the Biden policies would eat away at that capability and make the U.S. once again dependent on far too many foreign oil imports. And in some parts of the world, particularly Eastern Europe, it would make some countries overwhelmingly dependent on Russian gas and oil, yet again. For someone who supposedly decries Russian and its president, Vladimir Putin, Biden’s policies would benefit them considerably.
Potential job losses. A Biden presidency potentially could devastate the job situation in areas that traditionally rely on O&G employment. As API notes, “Biden glosses over the fact that he’s campaigning on eliminating countless natural gas and oil jobs by saying his plan would create millions of new jobs. However, the jobs his energy plan would create pay less, provide less opportunity for advancement, and likely require different skill sets than the natural gas and oil jobs it seeks to destroy.”
Moreover, continues API, and stated by the Wall Street Journal editorial board, “The Bureau of Labor Statistics says the O&G provides an average annual salary of $108,000, nearly twice the private economy average.” Hundreds of thousands of these jobs would be lost under Biden’s policies.
Actions we can expect. Rest assured, on day 1 of a Biden presidency, this guy will start chipping away at the U.S. O&G industry, particularly the upstream sector. The first thing to go will be fracing on federal lands, principally in the West. Then, the ability to lease federal lands for new O&G development will be the next item to bite the dust. Is it too far-fetched to see a day, when this guy will want to ban O&G production, period, on federal lands? And when we say federal lands, we refer also to offshore leases and production.
Meanwhile, fracing would eventually get the ax on all lands, public or private. And one can envision how Biden, through his surrogates in various states and municipalities, would encourage the passing of deleterious measures regarding proximity of operations to schools and homes, which would cut down development opportunities further. Let us not forget potential restrictions on waste disposal.
Biden could further reduce the need for U.S. O&G output by imposing punitive carbon taxes and mandating emission levels. Then, there is the all-time favorite method to reduce consumption, by raising gasoline taxes. And if that isn’t enough, he could withhold federal highway funds from states that fail to achieve certain levels of renewables production and usage.
The verdict—In a nutshell, Joe Biden and his delusions of renewable grandeur are a menace to U.S. energy security, economic security, and national security.