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Fossil fuel companies are exploiting Russia's attack on Ukraine
For many people around the world, the Russian invasion of Ukraine is an unprovoked violation of international law and a humanitarian catastrophe. For the fossil fuel industry, it's an opportunity to exploit for profit.
Fossil fuel corporations' desire to cash in on the war is not always subtle. On February 24, the day Russian forces cross the Ukrainian border, the American Petroleum Institute (API) issued a statement ("Actions on Energy Security Should Match Reassuring Words on Ukraine Crisis") calling for fossil fuel extraction. API, the industry's main lobbying group, said it was now "critical" for the United States to allow more pipelines, drilling, and fracking:
[T]he administration continues to block U.S. energy production. Policies that restrict U.S. natural gas and oil development are steps in the wrong direction. Indeed, few things are more critical right now than providing energy security to American consumers as well as our allies abroad…If we don’t, the benefits of U.S. energy leadership are at stake…At a time of geopolitical strife, America should deploy its ample energy abundance – not restrict it.
On Twitter, API published a lengthy thread arguing that the "crisis" in Ukraine made it imperative to "unleash" America's energy.
The thread calls on the administration to "release permits for energy development on federal lands," issue an "offshore leasing plan for the next five years," "accelerate energy permitting infrastructure," and "reduce regulatory and legal uncertainty." Coincidentally, API's policy agenda prior to the Russian invasion of Ukraine is also, according to API, the ideal response to the Russian invasion of Ukraine.
In other cases, fossil fuel corporations are working through proxies. For example, on February 17, as Russian troops gathered along the Ukrainian border, 27 Republican Senators sent a letter to Energy Secretary Jennifer Granholm. The arguments in the letter are indistinguishable from API talking points:
We are concerned by recent attempts to restrict liquified natural gas (LNG) exports from the United States to our European allies amid rising tensions caused by Russia… Support for the expansion of pipelines to increase supply into the Northeast would help solve price spikes… [I[ncreased production and export volumes of U.S. natural gas… increases U.S. energy security and makes us essential to the energy security of others.
Over the last five years, these 27 Senators have received a combined total of $4,270,530 from oil and gas industry PACs, according to Open Secrets data. Over the same period of time, the Senators received nearly $6 million from executives and other employees of oil and gas companies. The lead author of the letter, Senator Bill Cassidy (R-LA) has received $294,600 from oil and gas industry PACs and $290,084 from oil and gas industry employees since 2017.
In other cases, fossil fuel industry talking points are laundered through columns published by major news organizations. The Wall Street Journal published a piece by hedge fund mogul Kenneth Griffin and a co-author titled "How to Beat Putin With Natural Gas."
Europe needs to replace as much Russian gas as possible with liquefied natural gas, ideally with long-term contracts to buy gas from allied countries such as the U.S. The American capacity to export liquefied natural gas is growing every year…Bans on fracking are misguided and neutralize a critical economic and geopolitical advantage. The U.S. should frack more, so it has the gas needed to wean Europe off Russian pipelines.
What neither Griffin nor the Wall Street Journal reveals to its readers is that Griffin's hedge fund is heavily invested in "shale gas exploration and production companies."
While the industry and its allies are presenting fossil fuels as the solution to Russian aggression, the fossil fuel industry has been empowering Putin for many years.
How Big Oil props up Putin
The fossil fuel industry has been "helping keep Russia's oil-dependent economy afloat." Exxon, for example, "has more than 1,000 employees in Russia." Through a subsidiary, Exxon owns "a 30% stake in Sakhalin-1 — a vast oil and natural gas project located off Sakhalin Island in the Russian Far East." It has operated the project for decades. Since the project's inception in 2005, the facilities have "exported more than 1 billion barrels of oil and 1.03 billion cubic feet of natural gas," providing critical revenue for Putin's regime.
BP has pledged to sever its relationship with Rosneft, Russia's state-controlled oil company. Exxon, however, has not followed suit.
Exxon's decision, thus far, to continue to partner with the Russian government reflects its longstanding ties to Putin. Rex Tillerson, the former CEO of Exxon, was awarded the Order of Friendship, "one of the highest honors Russia gives to foreign citizens." Tillerson was reported selected to become CEO in 2006 in part because of "his close relationship with Russia." Putin attended a 2011 signing of a deal that gave "Exxon access to vast Arctic oil deposits." After the agreement was signed, "the valuation of Rosneft soared by $7 billion in just five days."
Exxon was forced to exit Russia's arctic after sanctions were imposed following Russia's invasion of Crimea in 2014. Exxon argued the sanctions were unfair.
This year, as Russia threatened Ukraine, API has lobbied Congress and the federal government to limit the scope of U.S. sanctions. "Sanctions should be as targeted as possible to limit potential harm to the competitiveness of US companies," a spokesperson for API said in January.
The reality is that, as long as the world is dependent on fossil fuels, Putin will have control of a valuable resource that will assist in his efforts to retain and grow power.
Why clean energy is Putin's kryptonite
The reality is that “unleashing” America’s energy would take a long time before it made any meaningful impact in Europe. New fossil fuel projects take years to come online. A more effective way to weaken Russia’s geopolitical influence is to accelerate the transition to clean energy. This would not only help Europe achieve net-zero emissions — and stave off the most catastrophic impacts of climate change — but would also subvert Russia’s attempts to use natural gas as a political weapon.
Russia is the largest natural gas and second-largest oil exporter in the world. The country currently supplies more than 25% of Europe’s oil and 40% of its natural gas, according to the LA Times. Over the years, this dependency has only increased as more European countries move away from coal and to natural gas. By moving away from fossil-based fuels, Europe has the opportunity to reduce its dependence on Russia and minimize Putin’s political leverage.
As Erin Sikorsky, director of the Center for Climate and Security, told the LA Times, “the more that countries can wean themselves off oil and gas and move toward renewables, the more independence they have in terms of action.”
Already, European Commission President Ursula von der Leyen has stated that Europe plans to “doubl[e] down on renewables.” This week, the EU is also planning to unveil a new energy strategy that calls for “40 percent reduction in fossil fuel use by 2030.”