Five things to know about Russia, Ukraine and the U.S. energy impacts
There is a lot of information out there about what the war in Ukraine means for U.S. energy and climate action. Here are the facts.
If you’re not moved by what’s happening in Ukraine — the bombing of innocents, the mass exodus of people fleeing their homes, the bravery of the people and their leaders — you must not be paying attention.
But the effects of war rarely stay within the borders of any one country, and this one is no exception. As the war disrupts the world’s energy market, the oil and gas industry and its supporters are out in force, citing the crisis in Ukraine to argue for increased licenses to drill on federal lands and water, more permits to build pipelines, and other policies to slow climate action and accelerate the build out of fossil fuel infrastructure. But when you look closely at their arguments, they don’t hold up to scrutiny. In fact, if we follow their suggestions, we’ll actually exacerbate multiple problems. Doubling down on clean energy is still the best path for the health and wellbeing of Americans, and also puts America in a stronger position to promote global peace and stability.
Here are five things to know:
Fact 1: We already get a majority of our oil from domestic sources. Russian oil only represents 3% of our imports.
Only 35% of U.S. supply comes from international partners, compared to about 65% produced domestically. In fact, in recent years, the U.S. has been a net exporter of oil — meaning we produce and ship more than we bring in from other countries. We’re less reliant on foreign sources than we have been in decades. In 2021, Russian oil only accounted for 3% of our imports.
Fact 2: U.S. domestic oil and gas production is near record levels and new leases wouldn’t help the current crisis.
U.S. production of oil is currently rising and approaching record levels. The industry wants the Biden administration to open more federal land and waters for drilling leases in response to the crisis in Ukraine. New leases won’t help in the short run — it would be years before any new leases resulted in new oil and gas production (and, besides, the industry is already sitting on thousands of unused leases and permits).
Fact 3: Fossil fuel prices will always fluctuate in response to global events.
Fossil fuel prices are inherently volatile because there is an “inelasticity” (or inability to adjust) on both demand and supply side to price changes in the short run. That means that if you rely on gas to power your car, and you have to drive 20 miles to work everyday, there’s not much you can do if gas prices go up. You still have to rely on gas to power your car, and you still have to drive 20 miles to work everyday. You can cut out leisure trips, but there is often not much consumers can do to reduce their demand. On the supply side, production capacity is relatively fixed in the near term. It takes years to develop new supply sources or vary production. There is little policy makers can do to impact the global oil market (and rolling back climate commitments won’t do it).
Fact 4: We won’t fix Europe’s fossil fuel crunch by exporting more liquified natural gas.
The U.S. is already the world’s largest exporter of liquified natural gas (LNG). Sending more LNG from the U.S. to Europe could theoretically help with Europe’s current energy crunch, but the U.S. is exporting LNG at capacity, and that still represents just part of Europe’s overall consumption. And further, Europe’s terminals lack capacity to import much more gas. Ramping up that capacity to a level where it would help Europe would take years. Europe is looking elsewhere, with a new plan for a sustainable energy future that relies on renewables and is designed to reduce demand for Russian gas by two-thirds by the end of the year. The U.S. should look elsewhere too.
Fact 5: We need to act on climate, now more than ever.
The International Panel on Climate Change (IPCC) released a new report in February that sounded the global warming alarm bells loud and clear. The report, which detailed the impacts humans and the environment are already experiencing, and how much worse it can get, warned: “Any further delay in concerted anticipatory global action on adaptation and mitigation will miss a brief and rapidly closing window of opportunity to secure a liveable and sustainable future for all.” The report should serve as a reminder of the need to get off fossil fuels as quickly as we possibly can. We’ve known for 50 years that our dependence on oil and gas is damaging the climate and public health. We have the solutions — like wind and solar power, electric vehicles and electric buildings — at our fingertips. It’s time we acted.
The fossil fuel industry wants us to think that the war in Ukraine has changed the calculus — that we now need to put off the transition to clean energy in the name of “national security” and “energy independence.” But the facts make it clear: This is just an industry play to lock us into years of continued dependence on fossil fuels.
A better strategy would be to reduce our reliance on fossil fuels entirely by promoting energy efficiency, increasing wind and solar capacity, transitioning to electric vehicles and electric buildings, and making it easier for people to drive less. Many of these things could start making a difference quickly, and all would reduce our demand for foreign oil while providing the added benefit of addressing climate change.
If expanding oil and gas production isn’t going to help the Ukrainian people and isn’t going to ease the economic pain of sanctions for Americans, then why on Earth would we choose to make ourselves more dependent on fuels that are changing the climate, cutting short lives and destabilizing the world.
Originally published at https://uspirg.org.
