The US Energy "Dependency Debacle"

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UnderTheLens - APRIL 2022

THE US ENERGY "DEPENDENCY DEBACLE"

I'm in agreement with JP Morgan's CEO Jamie Dimon, who recently told the White House that what is urgently needed is a modern day "Marshall Plan" to save Europe while stopping further Russian aggression. Dimon envisions the US immediately re-establishing the US as a net exporter of energy which consequentially gives Europe an alternative to Russian Energy. This (Monroe like) doctrine would significantly aid in stopping Putin's war machine and Russia's expansionist aspirations, stabilize the EU while additionally enriching the US. It would also dramatically assist in helping the US avoid the depth of a looming US recession!

WILL IT HAPPEN? Not a chance on President Joe Biden's watch!

WHY NOT? Climate Change is just too important to Biden and his administration. The current administration is willing to sacrifice the US Economy and EU security to fight Climate Change, as it sees the primary threat to the world to be climate change. The Biden team immediately established extremely ambitious and possibly unrealistic climate targets. The goals include 100% renewable electricity by 2035 and a 45% emissions cut by 2032. Ultimately, the president wants to achieve net-zero emissions by 2050. This has been translated into meaning the immediate and dramatic reduction in all things "fossil fuel".

Additionally, but no less significant, Biden simply lacks the personal "boldness" & "imagination" that strong US Presidential leaders have historically exhibited and risen to in such times of crisis.

WHY IS ENERGY INDEPENDENCE CRITICAL?

National Security,
Maintaining a Standard of Living built on productivity through cost effective energy,
Economic Stability (control through supply shock avoidance).

BEFORE BIDEN ADMIN ASSUMED POWER

The United States had again achieved being a net total energy exporter in 2019 and 2020.

SOURCE: EIA

The United States became a net total energy exporter in 2019 for the first time since 1952 and maintained that position in 2020 even though both total energy production and consumption were lower in 2020 than in 2019. Total U.S. energy exports exceeded total energy imports by 3.46 quadrillion British thermal units (quads) in 2020, the largest margin on record. U.S. energy exports in 2020 totaled 23.47 quads, and energy imports fell 13% to 20.0 quads, the lowest level since 1992.

WHAT IS THE REAL PROBLEM?

A Complete National Shift in Policy to Green Technology since the current US Presidential administration assumed power,
A Utopian Plan envisioned by Centralized Government,
An Implementation Plan devoid of Economic Reality designed by Bureaucrats & Ideologs,
Input from private sector not sought, used nor considered; Completely Politically driven,
Incentives and Restrictions by regulatory dictate.
A plan not supported by countries aligned against the US and taking full advantage of a flawed US implementation approach.

WHY DOES EVERYONE APPEAR SO WILLING TO SUPPORT THIS POLITICAL DICTATE?

A media created narrative of "Fear" of Climate Change versus a reasoned approach to a longer term problem needing attention.
UN Agenda 21 and it`s well constructed "Sustainability" Narrative,
Little media coverage of new regulatory details, implementation actions taken or Presidential Executive Orders issued.

HOW DID THE US STOPPING BEING ENERGY DEPENDENT SO QUICKLY?

1- FRACKING TECHNOLOGY

US fracking increased the amount of oil available between 2011 and 2014 from about 1 million to 4.8 million barrels per day. The market became gutted with oil and the price fell to $27 per barrel. By 2019, due primarily to fracking, the US became the number one producer of oil and gas in the world. In fact, we became a net exporter of oil and gas.

Prior to Biden entering office, oil production of oil shale reached over 12 million b/d, but fell more than 1 million b/d during 2021. During this time, Russia became the world’s largest exporter of oil which helped fund their war effort in the Ukraine.

2- BIDEN POLICIES

Biden immediately cancelled the KeyStone Pipeline In his first days in power as President of the USA,
He signed over 40 Executive Orders in the first few days, many reversing Trump orders reducing restrictions on energy producers,
Biden put in place increased regulations on fossil fuel and coal producers,
He added regulations limiting the production of electricity through the US of carbon based fuels,
He stopped energy exploration and development in the Anwar National Refuge area of Alaska,
He placed restrictions on US rail transport of Oil and Gas,
He cancelled new drilling leases on Federal Lands,
He incentivized ESG activity which discourages energy investment in fossil and coal technologies.

... and the list goes on.

However, most importantly, the Biden Administration, as Energy Analyst Michael Lynch reports did the following:

"Under Obama, the government came up with a dollar value called the social cost of carbon. It is supposedly an estimate by the government as to the environmental damage from everything from rising sea level to wildfires and floods from the release of one ton of carbon dioxide via fossil fuel burning. But scientists are still completely uncertain about the direct impact the burning of fossils fuels may have on the environment. I hope this causes you to suspect the number may be related to magic.

But that never stopped the Obama administration from coming up with a solid amount of $57. Trump reduced the number to $7, but Biden revised the number to $51. The number is important because it gave the Biden administration the leverage to restrict oil and gas production based on supposed environmental and economic threats from greenhouse gasses (i.e., reduce permitting on federal lands)."

THE EU'S "GREEN" LOBBY UNWITTINGLY SURRENDERED ENERGY CONTROL TO RUSSIA

Gasoline prices were rising quickly before the war in Ukraine broke out, not only due to Biden’s interference in our oil production, but the inflation caused by his huge spending bills. Now we are proposing to buy oil from Iran instead of enabling our own industry to supply America’s needs?

This is the very definition of a "Dependency Debacle"!”

3- STARTED BUYING ENERGY FROM GOVERNMENTS WE SANCTIONED?

"The invasion of Ukraine by Russia created fears about the future of oil supplies which, in turn, pushed oil prices to record highs. And although the US buys less than 10 percent of its oil from Russia, Biden’s decision to stop buying oil from Russia, created more turmoil in the markets.

But perhaps the most irrational decision ever made by a President is Biden’s pursuit of [the] Iranian (and Venezuelan) nuclear deal to get access to Iran’s oil. They are the foremost sponsor of terrorism in the world and yet we are willing to sign a very one-sided treaty with them to gain oil which is extremely dirty (high sulfur).

We will pay them just as Obama did, with the helicopter carrying billions of dollars. And those payments will make it easier to develop delivery systems once they finally develop a nuclear bomb. On top of this, we are helping them build an nuclear power plant that will give them clean energy but not us."

STOPPING BLAMING THE US ENERGY INDUSTRY FOR FLAWED PUBLIC POLICY!

The petroleum industry complains the administration and congressional Democrats are sending mixed messages about the role they should play in lowering high energy costs.

While Biden officials have called for oil companies to increase their drilling capacity, the president's also suggested the industry is using high oil prices as an opportunity to gouge consumers at the pump — rankling the industry and further scaring off investors.
“Oil and gas companies shouldn’t pad their profits at the expense of hard-working Americans,” Biden said last week.
Earlier in the month, Darren Woods, the CEO of ExxonMobil, said his company was "working to maximize production to help fill the world's increasing demand for oil as production declines in Russia."
“The way to solve this problem is for this administration to stop their attack on oil and gas production,” Sen. John Thune (R-S.D.) .
“Come up with an all-the-above American energy strategy that will make America energy independent, less dependent upon energy from other places around the world," he said. “It's a very simple fix.”

CONCLUSION

WHAT MUST BE DONE URGENTLY!

Immediate Establishment of a National Priority of "Energy Independence",
The development of a realistic and economically viable Green Technology Implementation Plan,
An implementation plan centered on incentives, not penalties,
Re-establish proven Trump Administration energy regulatory changes immediately,
Establish bi-lateral energy trade agreements with Europe,
Shelf the Nordstream II pipeline and hand the unpaid bill to Russia,
Restart the Biden canceled East Mediterranean Pipeline project,
Open up Anwar for exploration and modern approaches to drilling,
Remove Financial disincentives for energy investment and allow the private sector to do what it does best - solve problems,
Stop the central, bureaucratic planning of the US energy complex.

CURRENT MARKET PERSPECTIVE

FOSSIL FUEL COSTS ARE GOING MUCH HIGHER

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