Biden’s Energy Policy and Its Consequences

August 10, 2020

Less than 90 days away from the Presidental election, energy policy has emerged as one of the core issues.

Forbes reports:

Energy is the lifeblood of the modern economy – hence U.S. energy policy will affect the livelihood of all Americans. As the U.S. has emerged as the world’s leading oil and gas producer over the past decade, the energy and climate policies adopted by the next U.S. administration will also profoundly influence global economic and geopolitical affairs.

In the Democratic Party presidential primaries, almost all of the more than 20 major nominees supported Rep. Alexandria Ocasio-Cortez’s Green New Deal. Ironic, considering the lack of the support it gained in the Senate when brought to the floor for a vote. Last March, no senator voted for it; 57 (including all Republicans and a handful of Democrats) voted against it, and the remaining 43 (all Democrats) voted “present” as a protest.

Yet, the radical grand plan has stayed alive among the progressives within the Democratic party. Since “Moderate” Joe Biden has become the presumptive Democratic nominee, he has continued to move farther left especially on energy policy. Biden’s latest and more aggressive climate plan to spend $2 trillion over four years, achieve zero net-emissions by 2050, and recommit to the Paris climate accords, is an attempt to appeal to the young progressives in his party.

In the age of U.S.-led oil abundance, conventional notions of geopolitical risk and perceptions of energy security have been upended. The surge in U.S. oil and gas production which gathered pace in the past few years with President Trump’s “energy dominance” agenda has made the U.S. less vulnerable to political and social upheavals in the Middle East and has increased its foreign policy leverage in achieving its strategic objectives. It has given the U.S. greater latitude to support allies and sanction rivals. It has made it easier for the U.S. to impose export sanctions on oil-producing adversaries such as Venezuela and Iran without the fear of a resulting spike in global oil prices or on US domestic gasoline prices.

By effectively making the U.S. the “swing” producer in global oil markets, the fracking revolution has weakened the ability of OPEC and Russia to support crude oil prices by restraining output. A Biden presidency which would vacate the role of the U.S. as the world’s leading oil and gas producer would no doubt be welcomed by Russia and the OPEC oil and gas exporters struggling with low energy prices.

While Biden is more focused on winning over the approval of radicals in his party, he should look at the risks of proposing a radical makeover of the U.S. economy in the midst of a global pandemic that has crippled the U.S. economy and workforce. The valuable industry that has secured our energy independence and diplomatic influence deserves to be protected not dismantled.