Editorial

Guest editorial: We indeed can produce gas in U.S.

EDITOR’S NOTE: The following is a lengthy response to Army’s Bob’s recent column about American energy independence. It was written by a Townbroadcast commenter with the nom de plume “FRWF,” maintaining that America since 2015 has been exporting too much oil to foreign nations.

Yes it’s true we can be energy proficient, but at least you (Army Bob) should be honest with your fan club when you write your opinion.

“It’s not even winter yet, and America’s Northeastern states are already experiencing both shortages and price shocks on heating oil. The headline at Bloomberg this week says it all: “New York, New England Ration Heating Oil Even Before Peak Winter.”

The Saudi oil minister, Prince Abdulaziz bin Salman, just gave America a menacing warning about President Biden releasing oil from the strategic reserve to prevent an explosion in gasoline prices:

Meanwhile — as US gas prices remain persistently high causing Democrats heartburn in this election year — American oil companies continue Trump’s policy of exporting hundreds of millions of dollars’ worth of crude oil and refined gasoline to Brazil, helping Bolsonaro keep his own gas prices low as he heads to his election runoff.

You can thank Senators Joe Manchin (D-WV), Heidi Heitkamp (formerly D-ND, now a lobbyist), Bob Corker (formerly R-TN, now a bankster), and Lisa Murkowski (R-AK) for this mess, at least in large part. And, of course, the fossil fuel interests who “lobbied” them in 2015 with piles of cash.

Back in 1975, after the hard lesson learned from the 1973 Arab Oil Embargo, Congress passed the Energy Policy and Conservation Act which required the president to put into place rules banning the export of American-produced fossil fuels to countries other than Canada.

Oil produced in the United States stayed in North America. We were still importing oil, but we stopped exporting what we produced here other than minimal amounts to Canada.

In 1979, President Jimmy Carter declared war on our dependence on foreign oil, telling the American people:

“The energy crisis is real. It is worldwide. It is a clear and present danger to our Nation. These are facts and we simply must face them. …

“I am tonight setting a clear goal for the energy policy of the United States. Beginning this moment, this Nation will never use more foreign oil than we did in 1977. Never.

“From now on, every new addition to our demand for energy will be met from our own production and our own conservation. The generation-long growth in our dependence on foreign oil will be stopped dead in its tracks right now and then reversed as we move through the 1980’s…”

Carter put programs into place to cut our oil use (insulation, fluorescent light bulbs, automobile efficiency standards, etc.) but also announced that night that he was creating:

“[T]his Nation’s first solar bank, which will help us achieve the crucial goal of 20 percent of our energy coming from solar power by the year 2000.”

Carter’s rhetoric outraged the fossil fuel industry. A Republican campaign to distract from his message began by calling it Carter’s “Malaise” speech, even though he never once used the word malaise.

The following year, 1980, Ronald Reagan floated into the presidency on a river of big oil money. He promptly disassembled the White House’s solar panels as well as Carter’s program to achieve American energy independence by 2000 through energy efficiency and solar power.

Nonetheless, President Ford’s 1975 law banning US oil exports stood.

Oil exports from the US began to rise rapidly around 2015, when the aforementioned senators put forward the American Crude Oil Export Equality Act that legalized oil exports beyond Canada .

Then the administration okayed the 2017 sale of America’s largest refinery, in Port Arthur Texas, to Trump’s family’s Saudi patrons. Many in the business are now refining US crude here, leaving us with the poisoned air, waste, and cancers, and then earning billions by exporting the purified gasoline to other countries.

Under Trump, US-located refineries went on an export binge, keeping gasoline prices low in other nations like Brazil, where Trump ally Jair Bolsonaro was facing a tough reelection.

Last year, for example, gasoline exports continued Trump’s trend and reached a record high with most of it going to Brazil and Mexico. As Bloomberg noted last November 5th under the headline “U.S. Gasoline Exports Surge Even as Americans Pay Up at the Pump:

“Refiners shipped 139,000 barrels [of gasoline] a day to Brazil, the highest volume in data going back to 1945.”

If that massive quantity of gasoline had stayed here it would, of course, have dramatically lowered US gas prices.

As the fossil fuel industry pulled down an eye-watering $138 billion in profits in just the past three months, gas refiners and retailers in America jacked up prices because of a supposed gasoline shortage here.

And the Saudis, as part of their deal to buy America’s largest refinery, gained:

“[T]he exclusive right to sell Shell-branded gasoline and diesel in Georgia, North Carolina, South Carolina, Virginia, Maryland, the eastern half of Texas and the majority of Florida.”

In other words, if you’re complaining about gas prices in those Red states you need to take it up with Prince Mohammed bin Salman, because Trump’s refinery sale means Saudi Arabia’s company is setting those US prices.

All of this is, in a word, nuts.

We’re producing enough oil to uncouple us from world supplies, and as time goes on and we move to electric cars and renewable energy supplies, we’ll be using less and less of it.

It costs an average of $23 a barrel to produce oil in the US from existing wells and $48 a barrel from new wells (which includes all the costs of permitting and ramping up to production).

Oil could easily and profitably be selling for $60 a barrel in the US right now if we hadn’t gone along with the oil industry in 2015, and if we’d blocked the sale of our biggest refinery to the Saudis in 2017.

If we weren’t exporting about 30 percent of the oil we produce in this country, and then having to buy back that 30 percent from the Saudis and other producers, we could begin the process of uncoupling ourselves from the international oil markets that Russia and the Saudis are right now manipulating for their profit and our loss.

Mohammed bin Salman may have recently cut Saudi oil production, according to reports, simply to screw with Biden’s popularity in the US before the election, to fill American political offices with Republican stooges, and help Trump come back into office in 2024.

As The Wall Street Journal reported .

“Saudi Crown Prince Mohammed bin Salman, the kingdom’s 37-year-old day-to-day ruler, mocks President Biden in private, making fun of the 79-year-old’s gaffes and questioning his mental acuity, according to people inside the Saudi government. He has told advisers he hasn’t been impressed with Mr. Biden since his days as vice president, and much preferred former President Donald Trump, the people said.”

So why are we still buying Saudi oil? Why haven’t we put the Port Arthur refinery into US hands? Why isn’t oil in the US selling for, say, $55 or $60 a barrel, where oil companies could make a sweet profit and gas prices would float around $2.50 a gallon?

It goes back to that massive and expensive lobbying effort by Big Oil in 2015: a handful of fossil-fuel-owned Democrats (Heitkamp and Manchin, principally) joined Republicans in pushing the amendment through Congress that reversed President Ford’s 1975 ban on exporting American oil. President Obama, over the loud objections of most Democrats, signed the legislation on December 18th of that year.

But that was then and this is now.

President Biden, trying to drive down gas prices, just announced he’s releasing 14 million barrels of oil from the US Strategic Petroleum Reserve. That’s the same amount of oil that US companies are exporting for highly profitable sale overseas every four days!

Noting that the fossil fuel industry, pushing an end to that export ban, had “greatly oversold the consumer benefits” in 2015, a massive new report from Public Citizen concludes:

“For crude oil, about 29% of U.S. production in the first six months of 2022 was exported. That is more than double the 12% exported in 2017 and quadruple the 7% exported in 2016, the first full year of unrestricted crude oil exports. In the first six months of 2022, 3.4 million barrels per day of crude oil were exported from the U.S., nearly three times as much as in 2017, when about 1.2 million barrels per day were exported.”

Republicans are running around screaming about Biden not authorizing new drilling leases in offshore or sensitive locations, while the oil industry is sitting on over 7000 unused leases.

And even if new leases were issued, and used as rapidly as is possible, it would be years before the oil coming from them was available on world markets.

This oil is being exported from America today. Right now. Right from under our noses. Making a fortune for a few billionaires and foreign countries while jacking American oil prices.

And we can stop that.

America is capable of energy independence and we don’t need to dance to the tune of Saudi Arabia and Russia. All it’ll take is the willpower that Jerry Ford mustered in 1975 to ban the export of American oil and refined oil products once again.

We can tell Saudi Arabia’s dictator and the most predatory oil companies to go screw themselves at the same time we do the best thing for the average American. “

13 Comments

  • Well Dave, as usual, you left out some pertinent facts and left the blame on Republicans. You seem to have forgotten who lifted the ban on exporting our oil. Particularly from Alaska, where Americans were promised that production from Alaska would remain in America, in exchange for our tax money being used to build he Alaskan Pipeline. The fact is, it was Bill Clinton that quashed the keeping American produced oil in America. Here is the article of Clinton’s decision and when that happened. “CLINTON LIFTS BAN ON ALASKA OIL EXPORT” https://www.washingtonpost.com/archive/politics/1995/11/29/clinton-lifts-ban-on-alaska-oil-export/1187d598-c095-4b71-894c-43ef2e5cecb4/ And soon after that? “Clinton Defends His Decision to Tap Oil Reserve” https://abcnews.go.com/US/story?id=95661&page=1 So, it wasn’t just those money grubbing Republicans that you hold responsible. Both Democrat and Republican Hogs have been feeding at the Oil Industry Trough for decades. Please try to be more unbiased in your reporting facts. You are trending more toward the opiniated media and straying from honest journalism each day.

    • Mr Moras, if you noticed there are Democrat senators in this piece, so it’s OK for AB to blame one party? And speaking of Alaska, why is it that all citizens in Alaska receive a subsidy payment from oil companies that pillage their resources? Why shouldn’t the rest of America receive the same? When they are, do the same on our national lands.

      • FRWF,
        The citizens of Alaska receive the money from the state government that set up a permanent fund from oil royalties, the state is paid by the oil companies to the point the state has excess so they rebate it to the people. A fund has been set up to continue it even when the “royalties” dry up. Ask the President, Senate and House controlled by the Democrats why the federal government does not receive royalties.
        As for blaming one party, the inflation took off when the Progressive/Socialists controlled the House, Senate and Presidency. Before the Progressive/Socialists controlled the entire government, we were energy independent and imported far less oil, which requires hundreds of tankers full of oil, burning millions of gallons of diesel fuel.

      • ABs articles are so far right they have no merit. He must get his info from Qnon or the Trump boys? We were energy independent under Carter. Trump sold us out to his Saudi buddies in LA. Like Hes doing to the PGA for the LIV to line his own pockets. My opinion!!

  • Having worked in the oil and natural gas drilling and production side of the business, I continue to watch misplaced outrage about domestic production of natural resources being exported. Once oil and natural gas are extracted, they become commodities on the world market.

    Oil measured in 42 gallon barrels (bbl) and natural gas in metric cubic feet (MCF), none of that oil or gas has little American flags or a special Red, White and Blue dye to show it comes from the USA. Same goes for refined product like the gasoline from a Louisiana refinery that’s shipped to Brazil.

    When an oil tanker loads up in Alaska bound for Japan or South Korea its cargo is owned by Exxon or Shell. Their sale of the cargo shows up on their financial statements and shareholder dividend checks. It’s a nationless commodity owned by multi-national corporations.

    In the case of the U.S., “free markets” and “capitalism” are words tossed around when they have a positive effect on the economies of specific states. The citizens of Alaska get an annual check that started when the Trans Alaskan Pipeline was started in the ’70s. It’s based on the price of oil and has ranged from $922 to a high of $3,000 in 2022, based on the price of oil. States like Texas and Louisiana have large production and refining operations that mean thousands of high paying jobs.

    Beware of politicians, talking heads and commentators wrapping themselves in the American flag, whining about high fuel costs and pointing fingers. Look at who contributes to their campaigns, who employs their spouses and/or relatives, who advertises on their networks.

    In Michigan it’s all political blather. If you believe US Rep. Bill Huizenga, Governor Gretchen Whitmer or someone running for a seat in the MI legislature having power to reduce oil prices on the world market, you exist in an alternative universe or accept alternative facts as truth.

  • Good to know there’s a sliding scale of “Socialism”.

    Not picking on Alaska but they’ve got a great thing going for being a resident of Alaska and getting annual PFD checks.

    Every Alaskan, man, woman and child is eligible are eligible to receive an annual dividend check for just being born in Alaska or establishing residency with the following:
    Stating you’ve lived in the state for a full year; haven’t claimed residency in another state; have no plans to permanently leave Alaska; prove you’ve been physically present in the state for 72 continuous hours in the last 2 years; haven’t been out of the state for more than 180 consecutive days unless it’s an “allowable absence.

    You aren’t eligible if you were incarcerated or sentenced for a felony in the previous year. You are also not eligible if you were in jail for a misdemeanor; you’ve been convicted of two misdemeanors or a felony since a January 1 1997.

    So a family of 4 applies annually with 4 individual applications and they get 4 checks. In the last 12 years those checks have been as low as $878 each ($3512 total) to 2022’s PFD checks that reflect the world oil price jump of $3284 each ($13,136 total).

    But that’s not socialism. Okey dokey.

    • Couchman with another knockout punch. Boy, isn’t that socialism nice! I’m sure AB doesn’t send back his socialism checks he receives from the government. But I believe that’s their motto — I can have mine, but screw the rest of you.

      • Mr. Annable,
        Sir, are you truly saying that an American who served our nation for more than two decades, six deployed overseas did not earn a retirement? Are you saying anyone who retired from the government, postal workers, first responders like FBI agents, fire fighters are socialist? You sir, need to look up the definition of socialism:
        Definition of socialism Webster’s Dictionary
        1 : any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods
        2a : a system of society or group living in which there is no private property
        b : a system or condition of society in which the means of production are owned and controlled by the state
        3 : a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done

        • AB, it’s not 1950 it’s 2022 and your party is the one wanting to strip those benefits away. Or do you deny that too? Remember those are entitlements, not earned according to U.S. Senator Rick Scott.

          Skoal!!

      • Gar AB spent 20 plus years on a government payroll .I am sure he paid zero into social security or medicare. Then worked in the private sector for ten years and now receives the same benefits the rest of us had to pay into for 40 years! Government pension and SS and medicare seen it happen several times!!

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