It is true that our world is still uncomfortably dependent on fossil fuels. It is also true that this dependence is having a negative effect on our environment. Truths abound when it comes to our relationship with oil and gas. We know that it would be wise to set our sights on improving alternative forms of energy, but the truth is that we are years away from reaching the goals needed to wean ourselves away from the black gold flowing throughout our economy. In truth we have to keep the engines of our industry roaring, and at this moment in time the demand for oil worldwide is causing a spike in prices that burdens our already stretched budgets. With the added tension of a boycott of Russian oil by most western nations, including ours, our resolve to support the cause of justice for Ukraine is truthfully being stretched to the breaking point. So with all of these truths how should we choose to react to the current crisis?
First, it would be wise to go back to March of 2020, a moment when the whole world was bowing under the weight of Covid 19 illnesses and deaths. Even the worldwide medical community was still learning about how to deal with the deadly virus as nursing homes and hospitals were being overwhelmed. Businesses were tanking as customers no longer came and workers stayed home sick. We shut down for a time hoping to flatten the curve and learn more about how to save lives. The virus took us on a global roller coaster ride and our uncertainties about how to react began to fray our patience and our willingness to work together not just as a nation, but as a worldwide community to overcome the vagaries of Covid-19.
Just before all of this began the world of oil and its commerce was not doing well. Former students of mine who had earned college degrees in difficult fields like petroleum and mechanical engineering found that there were no jobs waiting for them. In fact, the major players in the oil business and its related subsidiaries had begun to encourage older workers to take early retirement while not filling their positions with new employees. With remote working and learning becoming the norm for a time, the lack of demand for oil only exacerbated the problem. The cost of a barrel of oil fell to record lows and the layoffs of workers began in earnest in April of 2020, smack dab in the middle of the early days of the pandemic. I was acutely aware of these problems because I live in the Houston area which has at times been known as the oil capital of the United States. The energy corridor of the city was as decimated by the low price of oil as hospitals were by Covid deaths. It was a dark time when many people that I knew suddenly found themselves unemployed when there was not an abundance of alternative jobs for them to take, but gas prices were delightfully low.
January of 2021, brought vaccines and a lull in cases of Covid that created a demand for just about everything. Suddenly everyone was feeling optimistic and filling the roads and stores and spending money. Demand for goods and services outstripped supply causing shortages and long waits, but the good news was that the economy was beginning to hum again. It would need to adjust, but the signs were looking better as those who had endured most of the pandemic without incomes suddenly found opportunities for work. This great rush of activity and movement was a boon for oil companies and their investors. The price of a barrel of oil continuously rose as did the sticker at the gas pump. By the end of 2021, oil stocks and oil profits had achieved historical records. Despite inflation life seemed to be moving in the right direction.
Then Vladimir Putin decided to invade the democratic country of Ukraine and the western world aligned in a determination to punish Putin by doing major damage to his economy. One of the boycotts involved in the plan was to refuse to purchase Russian oil. Thus after two weeks of hell for the Ukrainian people as their nation has been torn apart by the invading Russians, the price of oil in the United States jumped dramatically, testing our national resolve to hold firm to the plan to topple Putin by way of the Russian economy. Instead of feeling proud to bite a bullet and sacrifice for the cause, many among us are whining about the cost of fuel while also falsely claiming that our predicament is totally the fault of President Biden and the Democrats, a ridiculous and false argument when faced with the facts.
Oil is part of a global market. The price is never determined by a single country or person. It is a complex process that often seems to have a life of its own. It is a system entangled with a hierarchy of investors, governing boards, administrators and workers all intent on making profits. Right now our country produces most of the oil used in the United States. Less than ten percent comes from Russia. The production comes from a variety of players including the big companies and small independent owners who are free to decide when and how much they are willing to produce for the market. As of this moment over 4400 wells with permits to drill are sitting dormant. They could come alive at any moment but for now the owners do not wish to spend the money needed to hire workers to get the oil in them moving again. Since coming into office President Biden has given permits to more sites on government land than his predecessor. Around sixty percent of oil leases are not being used. The oil is there as are the permits to use it, but the companies do not feel that it is in their best interests to drill at this time.
About eighteen years ago my husband inherited some oil and gas leases from his mother who had obtained them from her mother. For almost two decades nothing has happened on them. We often get no payments or checks that are so minuscule that they would hardly buy a cup of coffee from Starbucks. This is not because of government policies, but a choice made by the actual owners of the wells. They have determined that it is not financially rewarding to bring the sites to life once again. So we hold on to our tiny investment and joke about how little everyone understands how the industry actually works.
The truth is that we can do a few things to weather the storm that is upon us, but mostly the behemoth known as the oil industry is bigger than any one person or political party. To insinuate that Joe Biden is responsible for our present dilemma is a false oversimplification of a complex problem. If we are to blame a single person for the sudden spike in the price of gasoline we should be pointing the finger at Putin. We should also ask ourselves if we really do care about Ukraine, because if we do then it will be up to us to have more patience than we seem capable of embracing. Our own pain at the pump will be the price we pay, but it seems minuscule when we witness the suffering of the Ukrainian people.
We should not continue to tear each other apart the way we have been doing for the last two years. When we do that Putin smiles. We should understand that our President is doing all that he can to support the Ukrainian people while also easing our economic woes. The ball is in the hands of Putin as well as the oil producers in our country. They can do the right thing, or not. Their choices will determine how much misery the world must endure. We can choose also. We have to decide if we are willing to go the distance together or if we no longer feel any sense of responsibility to each other and to our fellow humans in the world. It’s time that we all faced truths, including the need for a future without a dependence on fossil fuels. Denying reality will get us nowhere but deeper into turmoil. I for one am ready to do my part for a worthy humanitarian cause.