Port: We can't fix gas prices until the left admits we need oil
Want to fix gas prices? Clear the roadblocks in the way of building new refineries. End the political war on oil production.
MINOT, N.D. — President Joe Biden and the Democratic Party are not to blame for spiking gas prices. There are many variables contributing to that situation, many of them beyond the control of American political leaders.
For instance, nobody in America told Vladimir Putin to launch a bloody war of aggression against Ukraine.
But Biden and the Democrats absolutely deserve blame for creating a political situation here in America that makes it extremely difficult for our oil and gas industry to adapt in ways that could, at the very least, slow price growth at the pumps.
The hostility from the left to domestic production of oil and gas is nothing new, though it is hypocritical given how often Democrats find themselves supportive of foreign production. One of Biden's first efforts to address gas prices last year involved asking for more oil production, not from American producers, that pay American taxes and employ American workers, but from Saudi Arabia.
But now Biden finally recognizes that we need more domestic production — we are the world's top oil producer, after all — but even that request is couched with withering condescension.
In a letter sent to oil industry leaders, Biden demanded more gas production and fewer profits . “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,” he blustered.
Let's look at that demand from another perspective: The only thing that's going to drive down gas prices is increased production. The laws of supply and demand are immutable. But increasing oil production takes investment, and the oil industry is right to be reticent about investing in growth at the behest of an administration that is simultaneously trying to put them out of business.
And that's not my characterization. That's what Biden himself has said. During the 2020 election, then-President Donald Trump, during a debate, asked Biden, “Would you close down the oil industry?”
Biden's response? "I would transition from the oil industry, yes."
“Why would you do that?” a clearly flummoxed moderator asked Biden.
“The oil industry pollutes significantly,” Biden answered. “It has to be replaced by renewable energy over time.”
Later, Biden's campaign tried to walk those comments back, because it's an unusually candid thing for a politician in the middle of a national campaign to say, but even the clarification maintained that Biden's plan was to get “ rid of fossil fuels.”
But now here we are, with the Biden administration in office for two years pursuing a policy of prohibition toward oil, and it's more clear than ever that we can't just get rid of fossil fuels.
The President is basically begging the oil and gas industry to bail him out (albeit under a veneer of hostility aimed at keeping his left-wing base from open revolt).
Biden is talking to the wrong people. Nobody needs to tell the oil industry to produce oil. They'll be happy to do it. What would help is if Democrats like Biden moved back toward the center on energy policy.
What's roadblocking the American oil and gas industry is not just government permits and regulations (though that's a big part of it) but also an increasingly entrenched hostility in the capital markets. The ESG movement, for instance, has been very successful in deterring investment in the oil and gas industry .
Biden wants the oil and gas industry to invest in lowering gas prices at a time when his left-wing allies are making it extremely difficult to access the capital that makes those investments possible.
And remember, we can't just pump crude oil out of the ground and put it in our gas tanks. The oil has to be refined, and American refining capacity is shrinking thanks to many of the same political headwinds the oil production side is facing. We haven't built a major new refinery since the Carter administration, and the industry has given up trying. The last attempt was in 2005, in Arizona , and it failed.
“New refineries are unlikely to be built in the United States due to daunting environmental standards and policies that the Biden administration has been implementing to reduce petroleum product consumption in the future," the Institute for Energy Research noted in a recent report.
Want to fix gas prices? Clear the roadblocks in the way of building new refineries. End the political war on oil production. In their response to Biden's letter, ExxonMobil argued that we can “promote investment through clear and consistent policy.”
That doesn't mean we have to give up on the transition toward alternatives to oil - we should always be pursuing new and better ways of doing things - but it does mean we have to recognize how much we need oil today, and how much we hurt ourselves when we ignore that simple truth.