As OPEC has increased production to meet a growing global thirst for energy as the Covid pandemic recedes, Saudi Arabia has rejected requests from the Biden administration to increase production further. Even as demand for fossil fuels continues to rise, investment by major Western oil companies in oil and gas exploration and production has lagged in recent years due to the economic downturn of the pandemic and the pressure from investors to divest from fossil fuels and return profits to shareholders.
Beyond the impact of sanctions on Russian oil and gas on prices, there is also the fear of retaliatory cyberattacks. One such attack by a Russian criminal group crippled the critical colonial oil pipeline last year, spawning new gas lines and sparking panic buying across much of the southeast.
“A kind of amnesia about energy security has developed,” said Daniel Yergin, an energy historian and vice president of IHS Markit, a research firm. “This amnesia is dissipating now.” But he was optimistic that expanding US oil and gas production had put Washington in a much stronger position for a confrontation with Russia. “Europe would have basically caved in,” he said, if it weren’t for the US supply of liquid natural gas.
However, all this gas is not a security blanket for Europe. Local gas prices have quadrupled this winter, partly because Russia has cut shipments. It would have been worse if U.S. gas exports to Europe hadn’t nearly doubled between November and January last year, but those same exports helped push up U.S. gas prices as domestic stocks fell. .
Increasing gas exports are a powerful foreign policy tool, but fossil fuels are intrinsically linked to the growing problem of climate change.
“If you drill and plunder America first to get more fossil fuels domestically, you keep burning them and the carbon ends up in the atmosphere,” said Daniel F. Becker, director of the Safe campaign. Climate Transport at the Center for Biological Diversity. “The more we drill, the more wildfires, droughts and severe hurricanes we exacerbate because global warming is a direct result of burning fossil fuels.”
Electrifying transport could help, but electric vehicles need batteries containing essential minerals like lithium, cobalt, copper, nickel and rare earths often found in unstable countries. China is dominant in refining many of these minerals and could easily be the main energy rival of the future.
Jason Bordoff, director of the Center on Global Energy Policy at Columbia University, said the world must go on with cleaner energy to deal with climate change, but that change is no guarantee of a cleaner world. peaceful. “The old oil and gas politics,” he said, “is going to be with us and acute and layered on top of the clean energy politics.”