American Energy Leadership or Foreign Energy Leadership?

Frank Macchiarola
Posted June 15, 2022

So there it is: The national average price for a gallon of gasoline on June 15 is $5.01, which AAA says is the highest recorded average price. Ever.

Washington’s response? Just about everything except trying to address the No. 1 factor in the price of a gallon of fuel – the cost of crude oil.

With global oil demand growth continuing to outpace global growth in supply, exerting upward pressure on retail prices and hammering American families and businesses, Washington should clearly support the production of more American oil, now and in the decades to come – to put downward pressure on prices.

Instead, Washington blames Vladimir Putin and American oil producers. This week the president threatened U.S. refiners with federal action if they don’t produce more fuel and reduce their margins. And next month he’s scheduled to visit Saudi Arabia, where everyone knows energy will be the unavoidable elephant in the room.

Each of these is a symptom of energy malpractice, unbecoming of the world’s largest producer of oil and natural gas.

Instead of leading on energy – which America should do – Washington is surrendering energy leadership to others. As President Biden prepares to visit Riyadh, Saudi Arabia, there is a choice: American energy leadership or foreign energy leadership?

We can pursue policies and actions that harness America’s vast oil and natural gas resources, or we can go hat in hand to foreign nations and beg for more of their oil – as Washington has done since last summer. API President and CEO Mike Sommers, in an interview with Fox:

“[T]ime after time this administration has stood in the way of American energy independence and American energy security. They've cut off access to American energy, both in terms of the pipelines that we need to get the energy from where it is to where it needs to be and in terms of our access … for exploration. I would encourage the president to actually go to the Marcellus shale in Pennsylvania or go to the prolific Permian basin before they go to Riyadh. Unfortunately, we're at a point now where we're in an energy crisis that is unlike anything that we've seen since the 1970s. We need policies to support American energy independence.”

API this week offered a 10-point action plan for policymakers to unleash American energy, confront the global imbalance between demand and supply and finally begin to offer relief to consumers:

1. Lift development restrictions on federal lands and waters

2. Designate critical energy infrastructure projects

3. Fix the NEPA permitting process

4. Accelerate liquefied natural gas (LNG) exports and approve pending LNG applications

5. Unlock investment and access to capital

6. Dismantle supply chain bottlenecks

7. Advance lower carbon energy tax provisions

8. Protect competition in the use of refining technologies

9. End permitting obstruction on natural gas projects

10. Advance the energy workforce of the future

More access to public energy resources is needed, not less, as Washington policies have resulted in over the past two years. The administration is on a path that could see nearly three years elapse without a successful offshore oil and natural gas lease sale.

More oil and natural gas infrastructure is needed, to get American energy from where it is produced to where it is needed – including LNG export facilities that allow America to help allies abroad.

Red tape that unnecessarily restricts domestic energy development needs to be cut back, as well as permitting hurdles for key infrastructure.

Washington must stop talking down the American oil and natural gas industry and its future, which has a chilling effect on the investments needed for projects that can take seven to 10 years to come online. This includes the president’s new knock against American refiners, who already are running at or near capacity to meet demand. (API and AFPM joint response.)

Sommers said the administration's “misguided policy agenda …  has compounded inflationary pressures and added headwinds to companies’ daily efforts to meet growing energy needs while reducing emissions.”

Again, there’s a choice, a clear choice. One path leads to increased American energy self-sufficiency, benefiting American families and America’s friends around the world. The other amounts to an import-more-oil strategy and increased dependence on foreign energy sources. One path supports American jobs and cleaner energy production and transportation. The other bypasses American workers for energy produced in ways that are less friendly to the environment.

One makes American energy a strength, a point of leadership and helps make our country safer. The other weakens American energy and our country’s energy security.

It’s time for choosing.