Despite Best Efforts of Environmentalists, Natural Gas Remains a Popular Commodity

Despite Best Efforts of Environmentalists, Natural Gas Remains a Popular Commodity

August 4, 2021

Despite efforts by environmental activists and the Biden administration, natural gas continues to be a popular commodity this summer. This is due in part to a recovering economy and the increased demands for electricity. Today’s Wall Street Journal reports:

The heat wave that scorched the West has dissipated, but natural-gas prices have yet to cool off. 

The power-generation fuel has been in high demand to run air conditioners and make up for parched hydropower markets, and forecasters expect booming exports and more steamy weather to keep supplies down and prices up.

Natural-gas futures have gained 37% since April and are more than twice the price of a year ago. They settled Tuesday at $4.027 per million British thermal units.

The continued popularity of natural gas tells an important story. Namely, that it will continue to be a critical source of baseline power for generations to come. While environmentalists talk up the importance of sources like solar and hydro, the fact is that the sun is not always shining and the rivers are not always running. Yet even when supplies are low – and often times especially when supplies are low – the demand for electricity will remain.

This is also being demonstrated in Utah, where The Salt Lake Tribune reports the state’s fossil fuel industry is enjoying an unexpected resurgence:

There were just three rigs drilling in Utah’s oil and gas fields last January when newly installed President Joe Biden halted new leasing on public lands while his administration reviewed the federal oil and gas program.

Today there are 10 rigs sinking new wells in the Uinta Basin, according to energy consultant Baker Hughes. Meanwhile industry has flooded agencies with drilling proposals in Utah, filing more applications in the past six months than during any six-month period under Donald Trump’s industry-friendly reign as president, according to state data.

While this news is encouraging, the Biden administration’s efforts to halt new leases on public lands will still have a dangerous impact in the long-term. This growth in drilling is happening because there is a demand, and energy suppliers have the ability to meet it. What will happen if regulations prevent that from happening?  That’s a question the Biden administration would prefer people not think about.