For years, Joe Biden, first as candidate, then as president, along with House Democrats, argued for drastic measures to combat client change, including reduced production and use of fossil fuels.
For decades, the United States has imposed economic sanctions on Venezuela to combat socialist leaders who promote discord outside Venezuela’s borders and stifle democracy within. However, as gasoline prices climbed to historic levels, the Biden administration and House Democrats felt political pressure, leading them to admonish oil companies to invest and produce more to increase supplies and reduce pump prices.
After halting imports of Russian oil in protest of Ukraine, the administration even explored importing oil from Venezuela. Surreal? You bet. How we got here is described below, along with a handy reference — the average monthly nationwide price per gallon of gasoline (published by the Energy Information Administration) expressed in bold — to put each act or event in perspective.
That Was Then: Biden and House Democrats Combat Climate Change
In July 2019, prior to a Democratic primary debate, CNN’s Dana Bash asked: “Would there be any place for fossil fuels, including coal and fracking, in a Biden administration?” Candidate Biden responded: “No. We would work it out; we would make sure it’s eliminated and no more subsidies for either of those. No more fossil fuels.” ($2.83)
A couple months later, Biden grabbed the hands of a supporter, leaned into her, and said: “Kiddo, I want you to just take a look. I want you to look in my eyes. I guarantee you, I guarantee you we’re going to end fossil fuels.” ($2.68)
Later, standing alongside Senator Bernie Sanders during a Democratic presidential debate in March 2020, candidate Biden said: “No more subsidies for the fossil fuel industry. No more drilling on federal land. No more drilling including offshore. No more ability for the oil industry to continue to drill. Period. End.” ($2.32)
After he became the Democratic nominee, Biden’s campaign website explained that his administration would initiate a “government-wide effort” to combat climate change: “Biden will use every tool of American foreign policy to push the rest of the world…. We can no longer separate trade policy from our climate objectives.” ($2.20)
On his first day in office, in a single executive order, President Biden revoked the Presidential Permit authorizing the Keystone XL pipeline and suspended oil and gas leases in the Arctic Refuge. ($2.40)
Biden claimed the order was necessary “to confront the existential threat of climate change.” Within days, the Department of Interior (DOI) “paused” new oil and gas leasing on public land and offshore water to review existing leasing and permitting practices “related to fossil fuel development” on the properties. In June 2021, DOI identified “defects” in the decision supporting the leases and suspended all activities under the leasing program. ($3.16) Litigation ensued, a federal judge stayed the “pause,” and recently, limited, more expensive lease opportunities were noticed.
In October 2021, before Biden left for Glasgow to address the United Nations’ climate change summit, the House of Representatives’ Committee on Oversight and Reform brought in the executives of “Big Oil,” where Representative Katie Porter (D-Calif.) castigated them for investing too much in fossil fuels and not enough in renewable energy. ($3.38) In November, the House passed Biden’s Build Back Better, which included (among other things) key components of the Green New Deal. ($3.49)
That Was Then: Sanctions Ban All Venezuelan Crude Exports
In 2004, President George W. Bush first sanctioned Venezuela for working with Colombia rebels to flood the US with cocaine. ($1.91) Those sanctions continued in place during the next U.S. administration (Barack Obama) and Venezuelan administration (Nicolás Maduro). In 2015, Obama imposed additional sanctions for human rights abuses, corruption and antidemocratic actions. ($2.54)
In August 2017, to stop Maduro from profiting from crude sales, the Trump administration froze all Venezuelan government assets in the US and allowed the Treasury Department to sanction anyone aiding Maduro. ($2.49). Before leaving office, Trump slapped sanctions on three individuals, businesses and ships — all for assisting Maduro to evade the ban on crude sales. ($2.42)
The Biden administration left the sanctions in place, although enforcement has been half-hearted at best. That said, during his Senate confirmation hearings, Secretary of State, Antony Blinken emphasized: “We need an effective policy that can restore Venezuela to democracy, starting with free and fair elections,” a reference to Maduro’s “stealing” the 2018 election from Juan Guaidó. ($2.42) Since then, U.S. support for Guaidó was affirmed in a June 2021 letter from Biden to Guaidó ($3.15) and by a January 2022, State Department press release. ($3.49)
This Is Now: Combating High Gasoline Prices
While gas prices steadily increased, the secret hope of some environmentalists — that expensive gas would slow the use of cars and reduce pollution — was making economists and politicians nervous. Thus, in December, Secretary of Energy Granholm told the National Petroleum Council that she did not want to fight with them, urged the oil companies to increase production, and promised not to ban oil exports. ($3.40) In January, the Bureau of Land Management allowed oil and gas drilling on half of the National Petroleum Reserve in Alaska. ($3.41)
In March, the House Energy and Commerce Committee Chairman, Frank Pallone (D-N.J.) invited the executives of major oil companies to testify before the committee and urged them to invest new fossil fuel production “to increase short-term supply.” ($4.32) At the April hearing, Pallone called out the industry for “refusing to increase production….” ($4.21)
This Is Now: Biden Raids Emergency Stockpiles
In November 2021, with inflation raging, pump prices soaring, and House Democrats sensing losses in the midterm elections, Biden tried to tame gas prices by announcing the largest release of oil from the Strategic Petroleum Reserve (SPR), a limited resource maintained for emergencies. ($3.49)
In February, Russia invaded Ukraine. Biden responded with some sanctions, but not on the energy sector, fearing a further increase in pump prices. ($3.61) A stiffer response was needed, and in March, Biden banned Russian oil imports. ($4.32)
With pump prices already high, Biden sought another supply source. The State Department asked Saudi Arabia to increase production and address the death of journalist Jamal Khashoggi. The Saudis declined both requests. Next, Biden sent emissaries to Caracas to explore purchases of oil from Venezuela in exchange for easing sanctions and Maduro’s making progress toward restoring a democratic government. Biden’s initiative — rebuffed by Maduro, criticized by Guaidó, and rebuked by both Democrats and Republicans — fizzled.
Staring at already high pump prices, Biden played his last card, the SPR. In March, for the second time, Biden announced the largest-ever release of oil from SPR, one million additional barrels on the market per day on average for the next six months, which coincidentally would extend up to the national mid-term elections. ($4.32) When Biden took office, the SPR held approximately 640 million barrels, on April 1 only 564 million barrels, and after the latest sale is complete, only 384.6 million barrels.
Tags: Energy Policy, May June 2022 Print Issue, Regulatory Policy, Washington Watch