Energy Update: The World Faces A Dire and Intractable Energy Crisis
The world is headed for what could become the most severe and deadly energy crisis in history, and the politics of climate change are entirely to blame.
First, check out the story I posted at Forbes.com this morning, detailing the motivations behind yesterday’s grand farce of a hearing with executives from “big oil.” it’s important to understand why that hearing was held and why more just like it will be held in the future. Here’s an excerpt:
Apparently having failed to get the Biden administration memo that it was time to try to cajole “big oil” to produce more oil, Oversight Committee Chair Carolyn Maloney, D-NY, set the tone for the hearing at the opening, calling the CEO of Exxon a liar and comparing him and his fellow chief executives to the CEOs of the tobacco companies of the 1990s. Calling people liars and comparing them to tobacco executives is not exactly a textbook example of an effective means of persuasion.
But of course, persuasion was not the goal of this hearing. As the New York Times NYT +1% reported in 2016, this hearing was a piece of a continuing strategy to destroy the public reputation of the domestic oil and gas industry that was laid out at the 2012 La Jolla Conference where activists, lawyers, and academics mapped out a strategy to take down the energy industry. In the report issued after that gathering, one activist said that “It was widely agreed that, in the case of tobacco control, a turning point in public perception came at the 1994 ‘Waxman hearings’ on the regulation of tobacco products. On this highly publicized occasion, a broad swath of the populace became aware that the heads of the major tobacco companies had lied to Congress and the American public. Naomi Oreskes said tobacco litigation helped make this public narrative possible.”
Cong. Maloney’s hyperbolic and frankly absurd comparison of the oil executives to the tobacco execs makes more sense when understanding this context. In its 2016 report, the Times also notes that the lawsuits filed against Exxon by then-New York Attorney General Eric Schneiderman and several other state attorneys general were a part of this same strategy, saying “Since November, several attorneys general, beginning with Eric T. Schneiderman in New York, have sent extensive subpoenas to Exxon Mobil seeking internal documents related to climate change. The state attorneys general have said that while they consult widely in preparing an inquiry, the decision to proceed is based on the merits of the case alone.”
That New York case brought by Schneiderman was eventually thrown out by the state’s supreme court.
Democrat Rep. Ro Khana, who co-chaired the Bernie Sanders presidential effort in 2020 and is a member of the Oversight Committee, previewed hearings just like this one during an interview on MSNBC in September, noting that advisors to former Cong. Waxman were advising him and other Democrats in organizing and conducting them: “We want to have big oil hearings, like Waxman had the big tobacco hearings,” Khana told host Chris Hayes, “In fact, people advising Waxman actually are helping us craft the investigation.”
Oh.
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There’s much, much more there. Meanwhile, here’s a sampling of what is taking place in the rest of the world:
The world’s elite are flying out to Glasgow in their army of private jets as you read this to attend the UN’s COP26 climate summit. This is supposed to be a confab where our betters claim they’re going to decide how to address “climate change” in the decades to come, and save us all from a 2 degree temperature rise.
But there’s just one problem: 2 of the world’s 4 largest polluters - China (#1) and Russia (#4) won’t be in attendance. The world’s 3rd largest polluter - India - is only sending a small delegation.
But you can bet Joe Biden and his massive entourage will be there in force, because his handlers demand he be there. Biden will no doubt brag about his efforts to kill America’s oil and gas industry to the assembled elites, and boast of his efforts to convince congress to place our country even further in debt by allocating hundreds of billions more dollars for expanded and new subsidies for wind, solar and electric vehicles.
The elites will no doubt nod and applaud, but without serious participation from 3 of the world’s 4 top emitters of carbon dioxide, any global emissions deal reached by this conference will be meaningless.
While all the elites are applauding Biden in Glasgow, much of the rest of Europe will still be scrambling to acquire natural gas and coal with which to heat their homes during the upcoming winter. The same pea-brained elites applauding Biden in Glasgow have caused the crisis in Europe by convincing those governments to dismantle their natural gas and coal-fired power generating fleets in favor of building a lot of windmills. But the wind has quit blowing in Europe this year, and now the elites are worried they will be blamed for mass deaths caused by people freezing to death in their homes. Oops.
China and Japan and South Korea are also scrambling to secure ample natural gas and coal supplies for the winter, as global demand for both continues rocketing skywards. All that messaging about “peak oil” and “peak natural gas” demand pushed by climate alarmists and their global news media facilitators over the past decade has come up a crapper, and the crapper now needs more natural gas and coal and oil to fuel those economies as well.
China is so strapped for oil that is now rationing diesel and so short of natural gas that it is shutting down entire industries for weeks at a time to conserve fuel. Similar steps at conservation are being invoked across Europe.
How far has demand increased? In September, the United States consumed more oil per day than ever in its entire history. A new record of more than 22 million barrels of oil per day.
Meanwhile, U.S. gasoline prices averaged $3.18 for regular in September, an 8-year high. Why? Because the oil price set on the global market continues to rocket up due to tight supply.
So, why is supply tight? Not due to any shortage of available oil reserves. No, it’s because of over-regulation of the industry globally and efforts to deny capital to it that is needed to fund exploration and drilling efforts. ESG-focused investor groups that work to deny that capital to this key industry boasted recently that they now control $35 trillion in capital resources. Multiple industry analysts have concluded this year that this denial of capital has resulted in an under-investment in the finding of new oil and gas reserves of upwards of half a trillion dollars over the last 7-8 years.
That level of under-investment is not something that can or will be resolved quickly, and there is not enough wind or solar power in the world to make it up. What this means is that the energy crisis we are about to experience over this coming winter is likely to become just the first inning in a dire and intractable long-term catastrophe.
The CEO of a large pipeline company reminded me this week that economic prosperity has always been supported by cheap and abundant energy and that intractable poverty is almost always accompanied by a dearth of available energy.
The President of Uganda, Yoweri K. Museveni, agreed with that CEO’s contention last week, when he wrote in the Wall Street Journal that “Solar and Wind Force Poverty in Africa.”
Here is an excerpt from that terrific op/ed:
Africa can’t sacrifice its future prosperity for Western climate goals. The continent should balance its energy mix, not rush straight toward renewables—even though that will likely frustrate some of those gathering at next week’s global climate conference in Glasgow.
My continent’s energy choices will dictate much of the climate’s future. Conservative estimates project that Africa’s population of 1.3 billion will double by 2050. Africans’ energy consumption will likely surpass that of the European Union around the same time.
Knowing this, many developed nations are pushing an accelerated transition to renewables on Africa. The Western aid-industrial complex, composed of nongovernmental organizations and state development agencies, has poured money into wind and solar projects across the continent. This earns them praise in the U.S. and Europe but leaves many Africans with unreliable and expensive electricity that depends on diesel generators or batteries on overcast or still days. Generators and the mining of lithium for batteries are both highly polluting.
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Saying any of this meets with backlash from developed nations. Instead of reliable renewables or greener fossil fuels, aid money and development investments go to pushing solar and wind, with all their accompanying drawbacks. And many Western nations have put a blanket ban on public funding for a range of fossil-fuel projects abroad, making it difficult for Africa to make the transition to cleaner nonrenewables.
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Africans have a right to use reliable, cheap energy, and doing so doesn’t prevent the development of the continent’s renewables. Forcing Africa down one route will hinder our fight against poverty.
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The world today faces a coming dire and intractable crisis in energy supply. The people who have played the largest role in causing this situation are meeting next week in Glasgow. Now, you can say that their goals have been noble and I won’t even necessarily argue with you about that. But it is simply unarguable that they have been pointedly and repeatedly warned about the inevitable consequences of the actions they have taken over the last 20 years, and they’ve taken those actions anyway.
That’s the truth, and we should not be shy about telling it.
That is all.
David, thank you for this most informative article. Now, some pieces of previous puzzles are coming together!