U.S. Oil and Gas Exports Secure Vital Geopolitical Influence

U.S. Oil and Gas Exports Secure Vital Geopolitical Influence

June 28, 2021

We at Power The Future have preached time and time again that the energy independence the oil and gas industry has secured for the U.S. is vital to our national security and America’s geopolitical influence on the national stage.

President Biden’s continued attacks on the industry puts that geopolitical influence at stake and opens the U.S. up to vulnerability. The Biden administration’s halt on lease sales for oil and gas production on federal lands and water is one of the many blows the industry has faced. Not only does the lease of federal lands for oil and gas production provide millions of dollars of revenue for the states and local governments and economies, but it is also critical to pursuing America’s geopolitical goals.

Biden’s plan to halt lease sales does nothing to further his aspirations of lessening fossil fuel use, instead it will only curb domestic oil and gas production, not consumption.

The Hill reports:

The immediate result would be two-fold: higher prices and increased imports, often from countries that don’t align with our interests. Supply would stagnate or drop if domestic oil and gas production is not allowed to prosper. When supply is lower and demand continues to rise, as it inevitably will, prices rise. Under the Biden plan, we would pay more for our oil and gas. 

From 2015-2020 U.S. exports grew while imports shrunk to the point that the U.S. exported more crude oil and petroleum products than it imported.

Increased natural gas production not only enabled the U.S. to reduce coal use in favor of cleaner natural gas, but to start exporting liquified natural gas to other countries. And now the prices for these commodities are rising, so we should be experiencing an economic boon.

Due to the uncertainty of the oil and gas industry in this administration, oil producers are wary of pursuing new projects. U.S. production is down 2 million barrels per day from 2019, and now again, we are a net importer of petroleum instead of a net exporter.

If the Biden administration continues to constrain production on federal land, we are heading toward a situation in which, despite vast and accessible resources, the U.S. once again would rely on foreign oil and natural gas. 

Exporting oil and gas isn’t just about growing the U.S. economy, it is a critical strategic geopolitical tool.

One of the most important geopolitical benefits of domestic oil production and exports is countering Iran. For three years, U.S. sanctions crippled Iran’s oil exports. Many countries that used to buy Iranian light oil started buying the same type of oil from the United States. Now the U.S. is negotiating with Iran to end those sanctions, which would permit Iran to openly export oil. If U.S. oil leaves the market at the same time Iranian oil returns, the U.S. will hand our market share to Iran, a state sponsor of terrorism.

The future of oil and gas production on federal lands and waters likely will face additional legal wrangling. However, from a strategic perspective, the answer is clear. We must continue to lease federal land for oil and gas production — both for the U.S. economy and to maintain American power and influence around the world.