Saturday, March 12, 2022

Biden’s Energy-Policy Bind

By Kevin D. Williamson

Tuesday, March 08, 2022

 

The Biden administration has announced that it will ban imports of Russian oil and natural gas into the United States. This will raise some tricky questions, domestic and geopolitical, beginning with our relationship with the autocratic regime of Nicolás Maduro in Venezuela.

 

The quantities affected by the new ban on Russian imports are not very large for either side: Russian oil typically accounts for something like 1 percent of U.S. oil consumption and 3 percent of U.S. oil imports, while the United States accounts for about 5 percent of Russian oil exports — not nothing, but not a make-or-break share for either party.

 

Still, there are complications. The United States is the world’s largest oil producer and one of the largest — in some months, the largest — exporters of oil, natural gas, and petroleum products. We produce about 20 percent more oil than second-place Russia does. But we also import a great deal of oil and other petroleum products for a variety of reasons, ranging from the configuration of U.S. refineries to artificial production and transport constraints such as the Jones Act to all those blocked pipeline projects and bans on “fracking.” New Yorkers are not alone in paying a high price for the stupidity and cowardice of Andrew Cuomo.

 

U.S. imports of Russian oil ticked up beginning in 2019 as sanctions on the Maduro regime took Venezuelan oil off the U.S. market. One Russian export, a semi-refined oil called Mazut 100, is a workable substitute for the heavy crude we had been importing from Venezuela before then. The replacement of Venezuelan imports by Russian imports was an unintended — though not unforeseeable — consequence of those sanctions, one that the Trump administration should have anticipated and taken into account. But in that matter as in so many others, the Trump administration was amateurish and short-sighted.

 

The Maduro junta has not mellowed in the passing years. It is as bad as ever. But Nicolás Maduro’s troops are not currently engaged in mass murder in Ukraine or threatening our NATO allies with nuclear blackmail. And so the basic geopolitical question is: Should the United States throw a lifeline to the worst tyrant in the Western hemisphere in order to undermine an even worse tyrant in Europe?

 

The Biden administration already is reaching out to Caracas, where officials describe the initial conversation as “cordial” and “respectful.” I’ll bet it is. And Maduro’s isn’t the only tyrannical tuchus that requires kissing: President Joe Biden is said to be planning a personal trip to Riyadh to beg Crown Prince Mohammed bin Salman to ramp up Saudi production. Sheikh Mohammed bin Zayed al-Nahyan of the United Arab Emirates may merit some presidential attention, too.

 

Right about now, President Biden must be wishing he had an extra pipeline to Canada. The thought has occurred to Alberta premier Jason Kenney, who observes about Keystone XL: “If President Biden had not vetoed that project, it would be done later this year — 840,000 barrels of democratic energy that could have displaced the 600,000 plus barrels of Russian conflict oil that’s filled with the blood of Ukrainians.”

 

Oops.

 

There are immediate domestic political concerns, too: President Biden is always hearing footsteps on his left and fears awakening the wrath of the climate-change lobby, but he also is an old-fashioned politician who understands that high-and-rising gasoline prices are bad news for the party in power. Those factors together would seem to press Biden in the direction of Venezuelan imports, replacing those forgone Russian imports (and maybe even adding a little more) to put downward pressure on the oil market without expanding U.S. drilling and production.

 

But there is one more wrinkle: Donald Trump not only won the critical state of Florida in 2020, he improved his numbers there a little bit above his 2016 showing. The Venezuelan diaspora was a key constituency that helped put him over the top in no small part because of his hard line on Maduro. Biden may not be looking ahead all the way to 2024, but there are a Senate seat and 28 House seats up for grabs in Florida in November. Governor Ron DeSantis is up for reelection, too — and he is the Republican governor Democrats would most like to see go down. If Biden goes soft on Maduro, he may make it hard for Democrats in Florida.

 

We could spare ourselves some of these calculations by maximizing our own output — not only of crude oil and natural gas but also of refined-petroleum products. That would also mean building the necessary pipeline infrastructure and reforming our antiquated maritime regulations to enable the transportation of those fuels. Doing so would offer many benefits that ought to appeal to Democrats and Republicans alike: lower prices, more strategic and economic flexibility, and a bunch of high-paying jobs for people who are not software engineers, investment bankers, or lawyers. But with the exception of waiving the Jones Act, none of that is work that can be done by next Monday.

 

And Biden needs a new energy strategy yesterday. Nuclear-power advocate Elon Musk can be three bowls deep and still offer a more coherent analysis of the energy situation than the Biden administration does at its soberest.

 

My guess is that the relative political weights will tip the Biden administration’s scales in the direction of tapping Venezuela as a short-term measure rather than asking voters to suffer $6-a-gallon gasoline or enraging the true-believer greens by beginning the medium-to-long-term project of jacking up U.S. energy production.

 

That will be very good news for Nicolás Maduro, and pretty good news for Vladimir Putin, too.

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