Why “Energy Independence” Can’t Come from Oil

June 9, 2022

Because when you are dependent on a commodity that is global, and whose price is set globally, it doesn’t matter how much you produce, if there is a shortage, even an artificially created shortage, somewhere else on the globe.

Catherine Rampell in Washington Post:

Good news: We’re energy independent again. Huzzah!

Bad news: “Energy independence” has turned out to be a hollow victory.

Gasoline is inching toward $5 per gallon nationwide, and Americans are furious. Fortunately, Republican politicians have been arguing for months that they have a solution: Just “return” the United States to “energy independence,” as we experienced under former president Donald Trump. Easy peasy.

“We have the skills, and we have the resources right here in the United States to be energy independent,” says Sen. Joni Ernst. (R-Iowa). “We shouldn’t be subjected to these prices.”

Other GOP lawmakers have even given a specific timeline for this elusive goal. “We have watched this president go after energy, so we can no longer be energy independent,” House Minority Leader Kevin McCarthy (R-Calif.) said over the weekend. His pitch to midterm voters: “In 156 days, we’re going to become energy independent.”

Astonishingly, McCarthy and his fellow Republicans have delivered on their promise early. Because, as it turns out, the United States is alreadyenergy independent — and has been for six months, according to data available through March.

Somehow no one appears to have noticed.

“Energy independence” is a political slogan in search of a concrete definition, but based on context, conservatives appear to be referring to situations when the United States sells more oil and petroleum products to the rest of the world than it buys from other countries. The United States initially became a net exporter of oil and petroleum products in late 2019, while Trump was in office, for the first time since at least the 1950s..

There were a few months in late 2020 and early 2021 when that vaunted new trend reversed, and the United States again imported slightly more than we exported. But even then, total petroleum production and consumption still remained nearly even.

That was the loss of “energy independence” that Republicans often decry, and (incorrectly) blame on President Biden’s supposed “war on fossil fuels” rather than the pandemic and its volatile effects on petroleum markets.

But even that quickly reverted back again. Since last October, we’ve been exporting more than we import each month, according to data from the U.S. Energy Information Administration, an independent government statistical agency. That is, we got back to “energy independence” under Biden, but Republicans forgot to update their talking points.

And what of the reports that fossil-fuel firms ratcheted down production in the past couple of years, allegedly because Biden was waging war on them?

It’s true that earlier in the pandemic (i.e. pre-Biden), energy production declined both domestically and internationally. No surprise, given that oil prices briefly turned negative. A lot of companies went bankrupt and investors lost money. In fact, Trump helped negotiate a cut to global oil production to help stabilize plummeting prices, another fact Republicans sometimes conveniently forget.

So congrats, America, we’ve achieved “energy independence,” and we’re reasonably close to the highest levels of oil production in recorded history. But what good did any of this do us?

Despite this prized achievement, U.S. petroleum prices remain painfully high. That’s because even if we can meet all our consumption needs with domestic production, oil prices are still set by global markets. If a major world supplier such as Russia suddenly gets taken offline, that drives global prices up — including here in the United States.


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