Oil (Petroleum) and Gasoline

Subterms

    More stories

    • 50 Shares189 Views

      in Elections

      Putin Is Onto Us

      by

      As the Russian Army continues to falter in Ukraine, the world is worrying that Vladimir Putin could use a tactical nuclear weapon. Maybe — but for now, I think Putin is assembling a different weapon. It’s an oil and gas bomb that he’s fusing right before our eyes and with our inadvertent help — and he could easily detonate it this winter.If he does, it could send prices of home heating oil and gasoline into the stratosphere. The political fallout, Putin surely hopes, will divide the Western alliance and prompt many countries — including ours, where both MAGA Republicans and progressives are expressing concerns about the spiraling cost of the Ukraine conflict — to seek a dirty deal with the man in the Kremlin, pronto.In short: Putin is now fighting a ground war to break through Ukraine’s lines and a two-front energy war to break Ukraine’s will and that of its allies. He’s trying to smash Ukraine’s electricity system to ensure a long, cold winter there while putting himself in position (in ways that I’ll explain) to drive up energy costs for all of Ukraine’s allies. And because we — America and the West — do not have an energy strategy in place to dampen the impact of Putin’s energy bomb, this is a frightening prospect.When it comes to energy, we want five things at once that are incompatible — and Putin is onto us:1. We want to decarbonize our economy as fast as we can to mitigate the very real dangers of climate change.2. We want the cheapest possible gasoline and heating oil prices so we can drive our cars as fast and as much as we want — and never have to put on a sweater indoors or do anything to conserve energy.3. We want to tell the petrodictators in Iran, Venezuela and Saudi Arabia to take a hike.4. We want to be able to treat U.S. oil and gas companies as pariahs and dinosaurs that should pump us out of this current oil crisis and then go off in the woods and die and let solar and wind take over.5. Oh, and we don’t want any new oil and gas pipelines or wind and solar transmission lines to spoil our backyards.I understand why people want all five — now. I want all five! But they involve trade-offs, which too few of us want to acknowledge or debate. In an energy war like the one we’re in now, you need to be clear about your goals and priorities. As a country, and as a Western alliance, we have no ladder of priorities on energy, just competing aspirations and magical thinking that we can have it all.If we persist in that, we are going to be in for a world of hurt if Putin drops the energy bomb that I think he’s assembling for Christmas. Here’s what I think is his strategy: It starts with getting the United States to draw down its Strategic Petroleum Reserve. It is a huge stock of crude oil stored in giant caverns that we can draw on in an emergency to offset any cutoff in our domestic production or imports. Last Wednesday, President Biden announced the release of 15 million more barrels from the reserve in December, completing a plan he laid out earlier to release a total of 180 million barrels in an effort to keep gasoline prices at the pump as low as possible — in advance of the midterm elections. (He didn’t say the last part. He didn’t need to.)According to a report in The Washington Post, the reserve contained “405.1 million barrels as of Oct. 14. That’s about 57 percent of its maximum authorized storage capacity of 714 million barrels.”I sympathize with the president. People were really hurting from $5- and $6-a-gallon gasoline. But using the reserve — which was designed to cushion us in the face of a sudden shut-off in domestic or global production — to shave a dime or a quarter off a gallon of gasoline before elections is a dicey business, even if the president has a plan for refilling it in the coming months.Putin wants America to use up as much of its Strategic Petroleum Reserve cushion now — just like the way the Germans gave up on nuclear energy and he got them addicted to Russia’s cheap natural gas. Then, when Russian gas was cut off because of the Ukraine war, German homes and factories had to frantically cut back and scramble for more expensive alternatives.Next, Putin is watching the European Union gear up for a ban on seaborne imports of crude oil from Russia, starting Dec. 5. This embargo — along with Germany and Poland’s move to stop pipeline imports — should cover roughly 90 percent of the European Union’s current oil imports from Russia.As a recent report from the Center for Strategic and International Studies in Washington, D.C., noted, “Crucially, the sanctions also ban E.U. companies from providing shipping insurance, brokering services or financing for oil exports from Russia to third countries.”The U.S. Treasury and European Union believe that without that insurance, the number of customers for Russian oil will shrink dramatically, so they are telling the Russians that they can get the insurance for their oil tankers from the few Western insurance companies that dominate the industry only if they lower the price of their crude oil exports to a level set by the Europeans and the United States.My sources in the oil industry tell me they seriously doubt this Western price fixing will work. Russia’s OPEC Plus partner Saudi Arabia is certainly not interested in seeing such a buyers’ price-fixing precedent set. Moreover, international oil trading is full of shady characters — does the name Marc Rich ring a bell? — who thrive on market distortions. Oil tankers carry transponders that track their locations. But tankers engaged in shady activities will turn their transponders off and reappear days after they’ve made a ship-to-ship transfer or will transfer their cargo into storage tanks somewhere in Asia for re-export, in effect laundering their Russian oil. Oil in just one very large tanker can be worth roughly $250 million, so the incentives are enormous.Now add one more dodgy player to the mix: China. It has all kinds of long-term, fixed-price contracts to import liquefied natural gas from the Middle East at roughly $100 a barrel of oil equivalent. But because President Xi Jinping’s crazy approach to containing Covid — in recent months some 300 million citizens have been under full or partial lockdown — China’s economy has slowed considerably, as has its gas consumption. As a result, an oil industry source tells me, China has been taking some of the L.N.G. sold to it on those fixed-price contracts for domestic use and reselling it to Europe and other gas-starved countries for $300 a barrel of oil equivalent.Now that Xi has locked in his third term as general secretary of the Communist Party, many expect that he will ease up on his lockdowns. If China goes back to anything near its normal gas consumption and stops re-exporting its excess, the global gas market will become even more scarily tight.Last, as I noted, Putin is trying to destroy Ukraine’s ability to generate electricity. Today more than one million Ukrainians are without power, and as one Ukrainian lawmaker tweeted last week, “Total darkness and cold are coming.”So add all of this up and then suppose, come December, Putin announces he is halting all Russian oil and gas exports for 30 or 60 days to countries supporting Ukraine, rather than submit to the European Union’s fixing of his oil price. He could afford that for a short while. That would be Putin’s energy bomb and Christmas present to the West. In this tight market, oil could go to $200 a barrel, with a commensurate rise in the price of natural gas. We’re talking $10 to $12 a gallon at the pump in the United States.The beauty for Putin of an energy bomb is that unlike setting off a nuclear bomb — which would unite the whole world against him — setting off an oil price bomb would divide the West from Ukraine.Obviously, I am just guessing that this is what Putin is up to, and if the world goes into recession, it could take energy prices down with it. But we would be wise to have a real counterstrategy in place, especially because, while some in Europe have managed to stock up on natural gas for this winter, rebuilding those stocks for 2023 without Russian gas and with China returning to normal could be very costly.If Biden wants America to be the arsenal of democracy to protect us and our democratic allies — and not leave us begging Saudi Arabia, Russia, Venezuela or Iran to produce more oil and gas — we need a robust energy arsenal as much as a military one. Because we are in an energy war! Biden needs to make a major speech, making clear that for the foreseeable future, we need more of every kind of energy we have. American oil and gas investors need to know that as long as they produce in the cleanest way possible, invest in carbon capture and ensure that any new pipelines they build will be compatible with transporting hydrogen — probably the best clean fuel coming down the road in the next decade — they have a welcome place in America’s energy future, alongside the solar, wind, hydro and other clean energy producers that Biden has heroically boosted through his climate legislation.I know. This is not ideal. This is not where I hoped we would be in 2022. But this is where we are, and anything else really is magical thinking — and the one person who will not be fooled by it is Vladimir Putin.The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips. And here’s our email: letters@nytimes.com.Follow The New York Times Opinion section on Facebook, Twitter (@NYTopinion) and Instagram. More

    • 125 Shares129 Views

      in Elections

      Why the Price of Gas Has Such Power Over Us

      by

      Ask Americans their outlook on the country — its future, its economy, its president — and their mood has risen and fallen in surveys this year in striking sync with the price of gas. Gas prices go up, and fear that the country is on the wrong track often does, too. Gas prices go down, and so does unhappiness with the president.It’s of course not the case that fuel prices alone dictate the optimism (or surliness) of the nation. But these patterns suggest that gas, distinct from other things we buy, wields real power over how Americans think about their personal circumstances, the wider economy and even the state of the nation. Yes, this year has been marked by economic uncertainty, Supreme Court shock waves, Jan. 6 revelations and enduring pandemic divides. But lurking in the background of it all has been the whipsawing price of gas.And it is, by the way, now trending down again with two weeks to go to the election.Gas Prices Spike; Confidence DipsConfidence in the economy and in the direction of the country fell as gas prices rose earlier this year. Then those patterns reversed as gas prices dropped. More

    • 75 Shares99 Views

      in Elections

      The Three Blunders of Joe Biden

      by

      If the Democrats end up losing both the House and the Senate, an outcome that looks more likely than it did a month ago, there will be nothing particularly shocking about the result. The incumbent president’s party almost always suffers losses in the midterms, the Democrats entered 2022 with thin majorities and a not-that-favorable Senate map, and the Western world is dealing with a war-driven energy crunch that’s generally rough on incumbent parties, both liberal and conservative. (Just ask poor Liz Truss.)But as an exculpating narrative for the Biden administration, this goes only so far. Some races will inevitably be settled on the margins, control of the Senate may be as well, and on the margins there’s always something a president could have done differently to yield a better political result.President Biden’s case is no exception: The burdens of the midterms have been heavier for Democrats than they needed to be because of three notable failures, three specific courses that his White House set.The first fateful course began, as Matthew Continetti noted recently in The Washington Free Beacon, in the initial days of the administration, when Biden made critical decisions on energy and immigration that his party’s activists demanded: for environmentalists, a moratorium on new oil-and-gas leases on public lands and, for immigration advocates, a partial rollback of key Trump administration border policies.What followed, in both arenas, was a crisis: first a surge of migration to the southern border, then the surge in gas prices driven by Vladimir Putin’s invasion of Ukraine.There is endless debate about how much the initial Biden policy shifts contributed to the twin crises; a reasonable bet is that his immigration moves did help inspire the migration surge, while his oil-lease policy will affect the price of gas in 2024 but didn’t change much in the current crunch.But crucially, both policy shifts framed these crises, however unintentionally, as things the Biden administration sought — more illegal immigration and higher gas prices, just what liberals always want! And then instead of a dramatic attempt at reframing, prioritizing domestic energy and border enforcement, the Biden White House fiddled with optics and looked for temporary fixes: handing Kamala Harris the border portfolio, turning the dials on the strategic petroleum reserve and generally confirming the public’s existing bias that if you want a party to take immigration enforcement and oil production seriously, you should vote Republican.The second key failure also belongs to the administration’s early days. In February 2021, when congressional Democrats were preparing a $1.9 trillion stimulus, a group of Republican senators counteroffered with a roughly $600 billion proposal. Flush with overconfidence, the White House spurned the offer and pushed three times as much money into the economy on a party-line vote.What followed was what a few dissenting center-left economists, led by Larry Summers, had predicted: the worst acceleration of inflation in decades, almost certainly exacerbated by the sheer scale of the relief bill. Whereas had Biden taken the Republicans up on their proposal or even simply counteroffered and begun negotiations, he could have started his administration off on the bipartisan footing his campaign had promised while‌ hedging against the inflationary dangers that ultimately arrived.The third failure is likewise a failure to hedge and triangulate, but this time on culture rather than economic policy. Part of Biden’s appeal as a candidate was his longstanding record as a social moderate — an old-school, center-left Catholic rather than a zealous progressive.His presidency has offered multiple opportunities to actually inhabit the moderate persona. On transgender issues, for instance, the increasing qualms of European countries about puberty blockers offered potential cover for Biden to call for greater caution around the use of medical interventions for gender-dysphoric teenagers. Instead, his White House has chosen to effectively deny that any real debate exists, positioning the administration to the left of Sweden.Then there is the Dobbs decision, whose unpopularity turned abortion into a likely political winner for Democrats — provided, that is, that they could cast themselves as moderates and Republicans as zealots.Biden could have led that effort, presenting positions he himself held in the past — support for Roe v. Wade but also for late-term restrictions and the Hyde Amendment — as the natural national consensus, against the pro-life absolutism of first-trimester bans. Instead, he’s receded and left Democratic candidates carrying the activist line that absolutely no restrictions are permissible, an unpopular position perfectly designed to squander the party’s post-Roe advantage.The question in the last case, and to some extent with all these issues, is whether a more moderate or triangulating Biden could have held his coalition together.But this question too often becomes an excuse for taking polarization and 50-50 politics for granted. A strong president, by definition, should be able to pull his party toward the center when politics demands it. So if Biden feels he can’t do that, it suggests that he’s internalized his own weakness and accepted in advance what probably awaits the Democrats next month: defeat.The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips. And here’s our email: letters@nytimes.com.Follow The New York Times Opinion section on Facebook, Twitter (@NYTOpinion) and Instagram. More

    • 63 Shares99 Views

      in Elections

      Will Gas Prices Doom Democracy?

      by

      Will the price of gasoline — a price that has very little to do with which party controls the government — nonetheless determine the outcome of the midterm elections, and quite possibly the fate of American democracy?I wish that were a silly question, but it isn’t. This year there has been a strong correlation between the price of gasoline and political polls.Earlier this year, when gas reached an average of $5 a gallon, everything seemed to point to a Republican blowout. By mid-September, with gas prices down almost $1.50, the election looked much more competitive. And some apparent recent deterioration in Democrats’ prospects coincided with an upward tick in prices in late September and early October. (Prices are now falling again.)Now, this correlation might be spurious. Other things have been going on, notably a partisan Supreme Court’s overthrow of Roe v. Wade. And political scientists who have studied the issue find that normally the effect of gas prices on political outcomes is fairly weak.But we are arguably in a special situation right now. Americans have been shocked by a sudden surge in inflation, which had been quiescent for decades, and the price of gasoline — displayed on huge signs every few blocks — is a potent reminder of our economic difficulties.What we know for sure is that politicians are harping on gas prices. Republicans don’t talk about the core personal consumption expenditure deflator, they declare that “gas was only $2 a gallon when Trump was in office!” The Biden administration talked a lot about the long slide in prices and is trying to get out the word that this slide has resumed.So this seems like a good time to make three important points about gasoline prices.First, the most important determinant of prices at the pump is the world price of crude oil, over which the United States has little influence. And I do mean “world price”: Prices in Europe and the United States normally move almost perfectly in tandem.Crude prices and hence gas prices were unusually low during Donald Trump’s last year in office, not because of anything he did, but because Covid had the world economy flat on its back, greatly reducing oil demand. Crude temporarily shot up after Russia invaded Ukraine, out of fears that Russian oil exports would be greatly reduced; it fell again as it became clear that a lot of Russian oil would continue to find its way to world markets.Second, smaller fluctuations are usually driven by technical issues at the refineries that turn crude oil into gasoline and other products. The mini-surge in gas prices that began in September (and now seems to be over) was caused by shutdowns of several refineries for maintenance and a fire at one refinery in Ohio. Again, this has nothing to do with policy.What about accusations that energy companies are deliberately holding production back to raise prices and profits?We shouldn’t dismiss this possibility out of hand. Some readers may recall the California electricity crisis of 2000-2001. When some analysts, myself included, argued that the facts suggested that market manipulation was playing a large role, we faced considerable ridicule. But it turned out that markets were, in fact, being manipulated; we have the receipts.As far as I can tell, however, the refining issues that led to recent price increases were genuine. I don’t think it’s wrong to stay suspicious, and keep energy companies on notice against pulling an Enron. But it’s probably not a current problem.Finally, gas isn’t expensive compared with the fairly recent past.One way I like to look at this is to look at the ratio of the price of gasoline to the average worker’s hourly earnings. Right now this ratio is considerably lower than it was in the early 2010s. Gasoline prices did plunge in 2014 — yes, under Barack Obama, not Trump. But this reflected a surge in fracking, which actually did increase U.S. oil production enough to have a significant effect on world markets. Unfortunately the fracking boom turned out to be a bubble that eventually burned up more than $300 billion in investors’ money.So gas prices probably won’t go back to the levels of the late 2010s, not because the Biden administration is hostile to oil production, but because those low prices depended on investors’ delusions about fracking’s profitability. Taking a longer view, as I said, gas isn’t actually expensive at this point.Furthermore, experts believe that with some troubled refineries coming back online, gas prices will fall substantially over the next few weeks.So what does this tell us about the success or failure of Biden administration policy? Very little. Biden’s jawboning of refiners over their margins might be having some effect; so might his release of extra oil from the Strategic Petroleum Reserve. Overall, however, it’s hard to think of a worse metric for judging a president and his party than a price determined mainly by events abroad and technical production issues here at home, a price that isn’t even high compared with, say, a decade ago.Yet gas prices may sway a crucial election, a fact that is both ludicrous and terrifying.The Times is committed to publishing a diversity of letters to the editor. We’d like to hear what you think about this or any of our articles. Here are some tips. And here’s our email: letters@nytimes.com.Follow The New York Times Opinion section on Facebook, Twitter (@NYTopinion) and Instagram. More

    • 138 Shares169 Views

      in Elections

      Biden Expands Effort to Lower Gas Prices and Secure Energy Independence

      by

      Depleting emergency oil reserves spurs criticism that the White House is trying to lower gas prices with midterm election politics in mind.The president rejected the notion that the move to release more oil was politically motivated by the upcoming midterm elections.Haiyun Jiang/The New York TimesWASHINGTON — President Biden expanded his efforts on Wednesday to blunt the pain of rising gas prices and reduce America’s exposure to global energy markets, which have become more volatile because of provocative actions by Russia and Saudi Arabia.The administration announced $2.8 billion in grants to expand domestic manufacturing of batteries for electric vehicles and the electrical grid, one day after officials said that the United States would release millions of barrels of oil from the Strategic Petroleum Reserve and that Mr. Biden would consider additional withdrawals this winter.The moves highlight how energy security is now at the center of the Biden administration’s economic agenda, which has been derailed by soaring inflation and Russia’s war in Ukraine. Those concerns come at a perilous political moment, with midterm elections that will determine dynamics in Washington less than three weeks away.Mr. Biden’s decision to order the release of 15 million additional barrels of oil from the Strategic Petroleum Reserve is designed to address the immediate worry of rising gas prices, which was exacerbated further by Saudi Arabia’s recent decision, in concert with Russia, to cut oil production. In total, 180 million barrels of oil have been released since Mr. Biden authorized the use of the reserve in March.The Biden administration is prepared to dip further into its emergency supplies this winter, despite concerns that depleting the reserve could put the nation’s energy security at risk.“We’re calling it a ready and release plan,” Mr. Biden said on Wednesday. “This allows us to move quickly to prevent oil price spikes and respond to international events.”Mr. Biden has described the releases as a way to blunt the impact of Russia’s war in Ukraine while domestic energy producers ramp up production. There are about 400 million barrels remaining in the stockpile, which has the capacity to hold about 700 million barrels.The Biden PresidencyWith midterm elections approaching, here’s where President Biden stands.Storyteller in Chief: President Biden has been unable to break himself of the habit of spinning embellished narratives to weave a political identity.Diplomatic Limits: OPEC’s decision to curb oil production has exposed the failure of President Biden’s fist-bump diplomacy with the crown prince of Saudi Arabia.Defending Democracy: Mr. Biden’s drive to buttress democracy at home and abroad has taken on more urgency by the persistent power of China, Russia and former President Donald J. Trump.Questions About 2024: Mr. Biden has said he plans to run for a second term, but at 79, his age has become an uncomfortable issue.In remarks at the White House, Mr. Biden rebutted the notion that his administration had placed curbs on domestic oil production. Instead, he called on companies to expand production and said even if demand for oil slows in future years, they would be able to sell it back to the federal government to refill the Strategic Petroleum Reserve when oil prices decline to around $70 a barrel.The president also accused oil companies of profiteering and warned them not to gouge prices as Americans are grappling with inflation.“When the cost of oil comes down, we should see the price of the gas station at the pump come down as well,” he said. “My message to the American energy companies is, you should not be using your profits to buy back stock or for dividends. Not now. Not while a war is raging.”Separately on Wednesday, the White House announced that the Energy Department is awarding $2.8 billion of grants that were created as part of the infrastructure legislation passed earlier this year..css-1v2n82w{max-width:600px;width:calc(100% – 40px);margin-top:20px;margin-bottom:25px;height:auto;margin-left:auto;margin-right:auto;font-family:nyt-franklin;color:var(–color-content-secondary,#363636);}@media only screen and (max-width:480px){.css-1v2n82w{margin-left:20px;margin-right:20px;}}@media only screen and (min-width:1024px){.css-1v2n82w{width:600px;}}.css-161d8zr{width:40px;margin-bottom:18px;text-align:left;margin-left:0;color:var(–color-content-primary,#121212);border:1px solid var(–color-content-primary,#121212);}@media only screen and (max-width:480px){.css-161d8zr{width:30px;margin-bottom:15px;}}.css-tjtq43{line-height:25px;}@media only screen and (max-width:480px){.css-tjtq43{line-height:24px;}}.css-x1k33h{font-family:nyt-cheltenham;font-size:19px;font-weight:700;line-height:25px;}.css-1hvpcve{font-size:17px;font-weight:300;line-height:25px;}.css-1hvpcve em{font-style:italic;}.css-1hvpcve strong{font-weight:bold;}.css-1hvpcve a{font-weight:500;color:var(–color-content-secondary,#363636);}.css-1c013uz{margin-top:18px;margin-bottom:22px;}@media only screen and (max-width:480px){.css-1c013uz{font-size:14px;margin-top:15px;margin-bottom:20px;}}.css-1c013uz a{color:var(–color-signal-editorial,#326891);-webkit-text-decoration:underline;text-decoration:underline;font-weight:500;font-size:16px;}@media only screen and (max-width:480px){.css-1c013uz a{font-size:13px;}}.css-1c013uz a:hover{-webkit-text-decoration:none;text-decoration:none;}How Times reporters cover politics. We rely on our journalists to be independent observers. So while Times staff members may vote, they are not allowed to endorse or campaign for candidates or political causes. This includes participating in marches or rallies in support of a movement or giving money to, or raising money for, any political candidate or election cause.Learn more about our process.The money will go to 20 companies in 12 states and will be used for projects related to the production of lithium, graphite and nickel that is used in batteries that power electric vehicles. One grant recipient, Talon Nickel, said it would use the $114 million it had been awarded to help set up a processing facility for battery materials in Mercer County, North Dakota.The North Dakota facility will process ore that the company plans to mine in Minnesota, one link in the first fully domestic supply chain for battery-grade nickel that Talon is building out in partnership with Tesla.While the Biden administration has stressed the importance of building up some domestic manufacturing of electric vehicle batteries, which is now heavily reliant on China, administration officials have also acknowledged the pollution risks in permitting new mines and processing facilities in the United States.Talon’s plan to build an underground mine to extract nickel from a water-rich area of northern Minnesota drew concerns from some in the area, including Ojibwe tribes who gather wild rice nearby.Todd Malan, the company’s chief external affairs officer, said the decision to locate the processing facility at an industrial site in North Dakota, instead of near the company’s proposed mine in Minnesota, was a “direct response” to those concerns. He said the company would create a “cemented containment facility” that would neutralize and contain waste from ore processing.“We hope that this is seen as a step toward addressing their concerns while still producing the necessary materials for the U.S. electric vehicle battery supply chain,” he said.Gene Berdichevsky, the co-founder and chief executive of Sila, a maker of battery materials, said the $100 million grant the company received would allow it to expand the size of a factory in Moses Lake, Wash.Sila’s technology substitutes silicon for graphite in electric vehicle batteries, making them smaller and lighter and reducing the need for materials imported from China. Mercedes-Benz, Sila’s first announced customer, plans to deploy the technology in sport utility vehicles that will be available for sale around the middle of the decade.During a manufacturing event at the White House with recipients of the grants, Mr. Biden described the race to make batteries in the United States as part of a broader economic contest with China. He noted that 75 percent of battery manufacturing is done in China and that the country controls nearly half of the global production of the contents of batteries.“China’s battery technology is not more innovative than anyone else,” Mr. Biden said. “By undercutting U.S. manufacturers with their unfair subsidies and trade practices, China seized a significant portion of the market. Today we’re stepping up, really, to take it back.”The grant funds, which could take years to yield results, are part of the Biden administration’s longer-term strategy to transition away from cars with combustion engines and reach a goal of making half of all new vehicles sold electric by 2030.But the use of the strategic oil reserves has fueled criticism that Mr. Biden is putting the nation’s near-term energy security at risk for political purposes.“The Strategic Petroleum Reserve was built for a national energy crisis — not for a Democrat election crisis,” said Senator John Barrasso, Republican of Wyoming. “Joe Biden is draining our emergency oil supply to a 40-year low.”Mr. Barrasso, the top Republican on the Senate Energy and Natural Resources Committee, said the president’s “dismal approval rating is not a justifiable reason to continue to raid our nation’s oil reserves.”On Wednesday, Mr. Biden denied that he was releasing more oil with the midterm elections in mind.“It’s not politically motivated at all,” Mr. Biden said, explaining that he has been working for months to lower gas prices. “It’s motivated to make sure that I continue to push on what I’ve been pushing.”Jack Ewing More

    • 150 Shares179 Views

      in Elections

      U.S. to Release Millions More Barrels of Oil to Contain Gas Prices

      by

      The Department of Energy will release 15 million more barrels from the Strategic Petroleum Reserve and plans additional releases this winter.WASHINGTON — The United States plans to release millions of additional barrels of oil from the Strategic Petroleum Reserve in December and to make additional releases over the winter, White House officials said on Tuesday evening.The releases from the strategic reserve this year have been a dramatic step by the United States to contain its gasoline prices and stabilize energy prices around the world. The latest move comes three weeks ahead of the midterm elections and amid growing concern that inflation could worsen as winter approaches and the conflict in Ukraine drags on.Officials said the United States would release an additional 15 million barrels of oil from the reserve in December, exhausting the 180 million barrels that President Biden authorized to be sold earlier this year. The sales were intended to serve as a “wartime bridge” as domestic production in the United States ramps up, but White House officials said on Tuesday that Mr. Biden is prepared to authorize additional oil sales later this winter if needed.The reserve can hold about 700 million barrels of oil and has about 400 million remaining. White House officials say they intend to replenish the reserve when world oil prices decline to a range of $67 to $72 a barrel; they are now hovering around $90.Mr. Biden is expected to announce the plan on Wednesday. Officials said he would also call on refining companies not to gouge prices and to pass lower energy costs resulting from the oil releases onto consumers.Gas prices in the United States eased over the summer as the United States sold oil from the Strategic Petroleum Reserve and concerns about a global recession deepened. They have increased again in recent weeks after the Saudi-led OPEC Plus decided to scale back petroleum supplies on the market by up to two million barrels per day to bolster the price of oil.The move angered Mr. Biden, who said last week that “there will be consequences” for Saudi Arabia’s decision.The White House has faced criticism from Republicans for depleting the strategic reserve ahead of the midterm elections, even as Republicans have made the specter of rising gas prices a central campaign theme.“Draining our emergency supplies is a shortsighted and dangerous choice that imperils our energy security at a critical time of global uncertainty,” Senator Jerry Moran, Republican of Kansas, said last week.The Biden administration has defended the decision, insisting that all Americans benefit from lower gas prices and that energy prices around the world are elevated because of Russia’s war in Ukraine.“President Biden has said for months how he is committed to doing everything that he can, in his power, to address Putin’s price hike,” Karine Jean-Pierre, the White House press secretary, said on Tuesday. “Should the president not do everything that he can to lower prices?” More

    • 138 Shares149 Views

      in Elections

      As Europe Piles Sanctions on Russia, Some Sacred Cows Are Spared

      by

      The European Union has been severing economic ties with Moscow to support Ukraine, but some countries have lobbied to protect key sectors.BRUSSELS — Eight months into the war in Ukraine, and eight rounds of frantic negotiations later, Europe’s sanctions against Russia run hundreds of pages long and have in many places cut to the bone.Since February, the European Union has named 1,236 people and 155 companies for sanctions, freezing their assets and blocking their access to the bloc. It has banned the trade of products in nearly 1,000 categories and hundreds of subcategories. It has put in place a near-total embargo on Russian oil. About one-third of the bloc’s exports to Russia by value and two-thirds of imports have been banned.But even now some goods and sectors remain conspicuously exempted. A look at just a few items reveals the intense back-room bargaining and arm-twisting by some nations and by private industry to protect sectors they deem too valuable to give up — as well as the compromises the European Union has made to maintain consensus.The Belgians have shielded trade in Russian diamonds. The Greeks ship Russian oil unimpeded. France and several other nations still import Russian uranium for nuclear power generation.The net impact of these exemptions on the effectiveness of Europe’s penalties against Russia is hard to assess, but politically, they have allowed the 27 members of the bloc to pull together an otherwise vast sanctions regime with exceptional speed and unanimity.“Ultimately, this is the price of unanimity to hold together this coalition, and in the grander scheme of things the sanctions are really working,” said Jacob Kirkegaard, a senior fellow in the Brussels office of the research group the German Marshall Fund, citing Russia’s diminished access to military technology as evidence.A Lukoil gas station in Priolo Gargallo, Italy, last month. The European Union has put in place a near-total embargo on Russian oil, but some sectors of trade remain conspicuously exempt from sanctions.Gianni Cipriano for The New York Times“We would love to have everything included, diamonds and every other special interest hit, but I am of the opinion that, if sparing them is what it takes to keep everyone together, so be it,” he added.The Ukrainian government has criticized some of the exemptions, with President Volodymyr Zelensky chiding European nations for continuing to permit business with Russia, saying they are skirting sacrifices.“There are people for whom the diamonds sold in Antwerp are more important than the battle we are waging. Peace is worth much more than diamonds,” Mr. Zelensky said to the Belgian Parliament during an address by video link in late March.Keeping Diamonds ComingThe continued success of Belgium and the broad diamond sector in keeping the Russian diamond trade flowing exemplifies the sacred cows some E.U. nations refuse to sacrifice, even as their peers accept pain to punish the Kremlin.Exports of rough diamonds are very lucrative for Russia, and they flow to the Belgian port of Antwerp, a historically important diamond hub.The trade, worth 1.8 billion euros a year — about $1.75 billion — has been shielded in consecutive rounds of the bloc’s sanctions, despite being raised as a possible target soon after the Russian invasion of Ukraine in late February.The Belgian government has said that it has never asked the European Commission, the E.U. executive body that drafts the measures, to remove diamonds from any sanctions list and that if diamonds were added, it would go along.Diamonds being sorted in Mirny, Russia, at a facility operated by Alrosa, the Russian state-owned diamond company. Russian diamonds have been shielded in consecutive rounds of European sanctions.Maxim Babenko for The New York TimesTechnically speaking, that may be true. But the latest round of penalties, adopted this month, exposed the intensive interventions when a coordination error occurred among the various services in the bloc that are involved in the technical preparation of sanctions.The incident, described to The New York Times by several diplomats involved as “farcical,” shows how the lobbying works. The diplomats spoke anonymously in order to describe freely what happened.The European Commission over the course of September prepared the latest round of sanctions and left diamonds off that list.But the European External Action Service — the E.U.’s equivalent of a foreign service or state department, which works with the commission to prepare sanctions — did not get the memo that diamonds should remain exempted and included in its own draft listings Alrosa, the Russian state-owned diamonds company.Once Alrosa had been put on the draft document, removing it became difficult. Spotting the error, Poland and other hard-line pro-Ukraine countries in the bloc dragged out the negotiations over the package as much as they could on the basis that Alrosa should indeed face sanctions.In the end, the need for unanimity and speed prevailed, and Alrosa continues to export to the European Union, at least until the next round of sanctions is negotiated. In proposals for a fresh, ninth round of sanctions, presented by Poland and its allies last week, diamonds were again included, but formal talks on the new set of penalties have not yet begun.A spokesman for the European External Action Service declined to comment, saying it does not comment on internal procedures involved in preparing sanctions.The Tricastin nuclear power plant in the Drôme region of southeastern France. France is one of several E.U. countries that depend on Russian uranium to operate civil nuclear power facilities. Andrea Mantovani for The New York TimesNuclear PowerMost exemptions have not been as clear-cut as diamonds because they have involved more complex industries or services, or affected more than one country.Uranium exported from Russia for use in civil nuclear power production falls under this category. Nuclear power plants in France, Hungary, Slovakia, Finland and other countries depend on Russian civilian uranium exports.The trade is worth 200 million euros, or about $194 million, according to Greenpeace, which has been lobbying for its ban. Germany and other E.U. countries have supported the calls to ban civilian nuclear imports from Russia, making this another issue likely to come up in the next round of sanctions talks.In August, Mr. Zelensky also highlighted the persistent protection of the Russian nuclear exports to Europe just as Ukraine’s Zaporizhzhia nuclear power plant came under fire.Some supporters of keeping Russian uranium running say that France and the other countries’ ability to generate electricity by operating their nuclear power plants during an acute energy crisis is more important than the political or financial gains that could come from a ban through E.U. sanctions, at least for now.Tankers in the NightOne of the most complex and important lobbying efforts to protect a European industry from sanctions is the one mounted by Greek diplomats to allow Greek-owned tankers to transport Russian oil to non-European destinations.This has facilitated one of the Kremlin’s biggest revenue streams. More than half of the vessels transporting Russia’s oil are Greek-owned, according to information aggregated from MarineTraffic, a shipping data platform.Supporters of the Greek shipping industry say that if it pulled out of that business, others would step in to deliver Russian oil to places like India and China. Experts say lining up enough tankers to make up for a total Greek pullout would not be simple, considering the sheer size of Greek-interest fleets and their dominance in this trade.According to European diplomats involved in the negotiations, their Greek counterparts were able to exempt Greek shipping companies from the oil embargo in a tough round of talks last May and June.Since then, the E.U. has come around to a United States-led idea to keep facilitating the transport of Russian oil, in order to avert a global oil-market meltdown, but to do so at a capped price to limit Russia’s revenues.The Greeks saw an opening: They would continue to transport Russian oil, but at the capped price. The bloc offered them additional concessions, and Greece agreed that the shipping of Russian oil would be banned if the price cap was not observed.The Greek-flagged oil tanker Minerva Virgo. Greek diplomats have lobbied for Greek-owned tankers to be allowed to transport Russian oil to non-European destinations. Bjoern Kils/ReutersEven if the economic benefits of such exemptions are hard to define, from a political perspective, the continued protection of some goods and industries is creating bad blood among E.U. members.Governments that have readily taken big hits through sanctions to support Ukraine, sacrificing revenues and jobs, are embittered that their partners in the bloc continue to doggedly protect their own interests.The divisions deepen a sense of disconnect between those more hawkish pro-Ukraine E.U. nations nearer Ukraine and those farther away, although geographical proximity is far from the only determinant of countries’ attitudes toward the war.And given that the bloc is a constant negotiating arena on many issues, some warn that what goes around eventually will come around.“This may be a raw calculation of national interests, but it’s going to linger,” Mr. Kirkegaard said. “Whoever doesn’t contribute now through sacrifice, next time there’s a budget or some other debate, it’s going to come back and haunt them.” More