I am writing to shed light on an important topic that affects both our local community and the global landscape: President Biden’s choice to slow/stop US oil production.
POTUS Biden’s policies on oil production have intended and unintended impacts, many of the former are not discussed in polite society. Another topic that is not discussed in polite society is the actual threat posed by Russia and the actual potential of our European allies, specifically Germany, France, and the United Kingdom, to handle Russia on their own.
These issues are interconnected and we need to accept that and look at them as a collective set. I think that by choosing to prioritize domestic oil production, the United States can both support Ukraine AND reduce Russia's war fighting ability by lowering worldwide oil prices. Its a fact that an implication of rising oil prices is that it generates cash flow for nations with a poor track record of protecting women, minority and LGBTQ peoples.
Let's start by debunking the notion that Russia poses an insurmountable threat to Europe.
While Russia is often portrayed as a formidable force, the reality is that our European allies possess significant economic and demographic advantages over Russia.
Put another way the U.S.S.R. IS NOT Russia.
Gross Domestic Product (GDP): Germany, with its robust economy, boasts a GDP of $4.2 trillion, surpassing Russia's GDP of $1.5 trillion by 3X+. Either France or the United Kingdom GDP’s of $3.7 trillion and $2.9 trillion respectively, are at least 2x larger that Russia’s.
Combined, these three major European nations form a formidable economic powerhouse that is ~5x larger than Russia.
With a 5x advantage in GDP, these three should be able to effectively defend their interests and deter Russia. We don't need to send them money we have to print.
GDP data: https://www.investopedia.com/insights/worlds-top-economies/
Population/Demographics: While GDP’s are a factor to compare, we need to also compare population. When comparing population, its vital to to remember that Russia is not the USSR.
USSR’s roughly 350 million citizens gave it a population that was about 2x of the US in 1980. However, in 2021 the United States has roughly 331 million citizens which far surpasses Russia's population of about 170 million.
Today, Germany, France, and the United Kingdom, have a combined population that exceeds 180 million.
Population data: https://worldpopulationreview.com/countries
A review of the population and GDP of the countries should put our current struggle with Russia into better context. It should starkly highlight the considerable advantage the US and our European allies possess in any conflict with the Russians.
Looking at our allies’ GDP and population we can see that they should be able to defend themselves against a Russian threat that is far smaller than the 1980’s USSR. We ought to be able to sit this one out. (and not send money we have to print)
More oil produce decreases the world wide price of oil
Now, let's delve into the issue of rising oil prices.
If we double the price of oil (because we pump less oil in the US) the Russians generate roughly 2 X the amount of income. Practically, POTUS Biden’s/Green New Deal US policy gives Russia $300B of ‘free cash’ to wage war.
(See oil price cost per barrel data at bottom of article for more info on this topic)
How does a decrease in US Oil production ‘give’ money to Russia?
During the 2010’s, when the US was producing 20% to 30% more oil, the price per barrel of oil was between $40 and $50. Returning to this price range would have a direct impact on countries heavily reliant on oil export income, such as Russia. Reducing the price per barrel would diminish their income and reduce their financial resources for war.
A price per barrel of oil at $80+, directly bolsters the economies of nations that disregard the rights of women, minorities and LGBTQ individuals. (Saudi Arabia, Russia, etc.). It funds their war machine.
By increasing US oil production, we decrease our reliance on foreign sources AND also empower Ukraine in the process. Instead of sending money, which the US must print or borrow, the United States can play a crucial role in stabilizing Ukraine's situation by driving down oil prices worldwide. This would limit Russia's oil generated cash flow and reduce ability to fund war.
By recognizing and leveraging these factors, we can formulate a more effective strategy in dealing with Russia and support Ukraine. Rather than sending money that we have to print we can have a similar impact by removing the lubricant of war: money.
If you are ‘pro war’ with Russia- or if you are a ‘green power’ supporter- I would ask you to reassess your perception of the Russian threat. The economic and demographic advantages held by our European allies should make this an event that we dont have to provide (a) money or (b) troops to fight the Russians.
By harnessing our domestic oil production and reducing worldwide oil prices, we can support Ukraine AND simultaneously weaken Russia's ability to wage war. It's time to prioritize strategies that empower our allies and secure our interests. We can ensure a safer and more prosperous global community without sending our money or kids to save the Europeans.
Lastly- if you thought that Iraq was a war for oil- I hope you see that this is also a war for oil. The only real difference is that US citizens do not benefit from a war with Russia- only our European allies’ benefit from this war. Lets make them lead on this issue.
Ukraine oil fields – location and reserves:
Russians invaded and took the oil rich areas of Ukraine. Who needs the oil that is located there? The Ukrainians? The Germans? The French? The UK? We dont.
Additional Sources of information:
Costs to pump oil:
https://graphics.wsj.com/oil-barrel-breakdown/
https://knoema.com/infographics/vyronoe/cost-of-oil-production-by-country