The Domestic Energy Producers Alliance (DEPA) Commends Senate Majority Leader McConnell in his steady leadership to providing American workers, families, hospitals and employers a “clean” stimulus package free from partisan giveaways.
The original bi-partisan Senate proposal included filling up the Strategic Petroleum Reserve (SPR) with domestically purchased crude. While not a solution to the Saudi/Russian attack on US energy independence the SPR purchase would have provided the US additional strategic reserves of low-cost petroleum and some relief to already struggling US producers being pushed over the edge by the economic shutdown.
Sadly, this desperately needed assistance for workers, families, hospitals and employers was held hostage in an effort to extort Green New Deal giveaways that harken back to the “shovel ready” boondoggle of 2008 and reeks of the kind of cronyism last seen with the Solyndra scandal.
Thankfully Majority Leader McConnell had the courage to reject this cynical game of blackmail, trading the purchase of low-priced US oil for America’s Strategic Petroleum Reserve in return for handouts and subsidies to renewable energy companies that are historical unprofitable.
The core of the problem for the U.S. oil and gas industry is the dumping activity of Saudi Arabia and Russia.
When negotiations on a plan for Saudi Arabia and Russia to collude in an effort to raise oil prices broke down both countries began a dumping effort aimed squarely at US oil producers. Russian dumping is pay-back for tough US sanctions on the Nord Stream 2 pipeline, which would complete the Russian energy stronghold on Europe. In 2014 the Saudi’s launched similar campaign, flooding the market with crude oil to drive U.S. domestic producers out of business. That effort failed due to the innovation and resilience of America’s energy workforce and industry. However, with the compounding problem of the global economic shutdown that resiliency is being desperately tested.
Saudi Arabia and Russia are acting like energy superpowers, conspiring in illegal dumping, in an attempt to crush US energy independence and restore their ability to hold the US and the world hostage to high energy prices.
To be clear, there is nothing free market about the collusion of two foreign states to break the back of US energy producers. Equally, there is nothing protectionist about the Trump Administration using the tools that Congress has provided to defend US companies against foreign aggression and anti-competitive activity. Any such claim is reckless and foolish.
If the Saudi and Russian governments do not immediately cease anti-competitive dumping aimed at the US energy industry the only choice for the Trump Administration is to promptly initiate a 232 trade action against both countries.
Failure to defend US energy producers against aggressive anti-competitive actions by Saudi and Russian state energy monopolies will result in the collapse of the US energy industry and any hope for economic recovery and will ultimately lead to higher energy prices for American consumers as US energy independence fades and the OPEC monopoly regains control of global energy markets.