- The COVID-19 pandemic exposes a weakness in our energy supply: an overreliance on imported oil and materials from China and the Organization of the Petroleum Exporting Countries (OPEC)
- Oil and petroleum products are part of the foundation of American life, from the gas for trucks delivering groceries, to the plastic in the equipment protecting our frontline essential workers
- If adopted, innovative methods of extracting oil and gas from local shale deposits offer America control over the energy supply chain
- California defies local energy production by importing 58.7% of the state’s oil from outside the U.S., driving up the cost of gas and fuel for the average consumer
- While other states hit hard by COVID-19 will have low-cost, locally sourced gasoline and diesel to fuel their recovery, California will remain at the mercy of a volatile oil supply chain
Here's the Breakdown:
The Coronavirus pandemic (COVID-19) is much like a natural disaster. It is swift-moving and unpredictable, exposing weaknesses in our nation’s infrastructure. As with a natural disaster, when the storm passes, damages must be assessed. Issues that have been long ignored — like fundamental and structural weaknesses in the American economy and potential national security vulnerabilities — will need the urgent attention of policymakers and business leaders.
This pandemic has already brought to light a flaw in the national economy most Americans never think about: our dependence on China and its supply chain for the goods we use every day, from clothing to iPhones and, more importantly, critical medical supplies like surgical masks and daily use pharmaceuticals.
China’s abundant cheap labor has allowed American consumers to purchase inexpensive products from Costco, Amazon, Walmart, and other retailers. But we have also become dependent on China for more sophisticated high-tech goods used by our military, which presents a threat to our national security.
Because of these hard facts exposed by life under COVID-19, there is a growing cry to support local and independent companies that employ American citizens. Companies like Braskem America, whose employees were recently featured on ABC News living on the manufacturing facility site for an entire month to make critical PPE materials, further illustrating the need to bring critical manufacturing back to the U.S. At the very least, we must find more reliable allies with whom we can do business.
Thanks to America’s fossil fuel industry, we have experience in developing a local supply chain that’s less dependent on unreliable partners in volatile parts of the world.
For example, innovative methods of oil and gas extraction from the shale deposits of the Permian Basin in Texas and many other places has surged production by 57% over the last decade. The Permian Basin alone pumps more oil than most OPEC nations. According to the USEIA, crude exports from the U.S. averaged 2.9 million barrels per day in the first half of 2019, and up to one million barrels per day for the same portion of 2018.
By altering our oil supply chain and breaking the overwhelming hold OPEC had on us during the oil crises of the 1970s, we gained control of the most vital materials on the planet: oil and gas.
Oil becomes gasoline to fuel our cars that are critical to commuting to work and traveling for leisure. Oil becomes the diesel that keeps trucks rolling and delivering supplies to our stores, especially at times like these. Oil becomes the jet fuel that keeps air travel moving. It is the oil and natural gas industry that powers the plants and delivers reliable electricity. These services will be needed when we return to normalcy from the stoppage created by COVID-19; the lifeline to the American economy will be fueling the recovery with low-priced energy.
However, one state that’s not on board with extracting oil from the shale deposits right underneath their feet is California. In fact, California still imports millions of barrels of oil to feed its voracious appetite.
According to the California Energy Commission, 58.7% of the state’s oil comes from outside the U.S., and nearly half of that comes from nations in the Persian Gulf, home of OPEC.
While other COVID-19-affected states will have access to low-cost domestic gasoline and diesel to fuel their recoveries, California will still be subject to a volatile oil supply chain that’s vulnerable to the whims of OPEC leaders.
Let’s not forget that when the pandemic’s “stay-at-home” orders are lifted, California will need 43 million gallons of gasoline, 13 million gallons of diesel, and 10 million gallons of jet fuel every single day. Will it be expensive fuel?
California must join our country’s dedicated fossil fuel team and end its dependence on expensive fuel from international regions that have little regard for the freedoms we treasure here in the U.S.