Life in America is poised to get more expensive heading into the new calendar year. It will cost a good chunk of Americans’ paychecks to heat their homes, fill their tanks, and purchase food. Energy prices are soaring, and the consensus on Wall Street is that they will climb even more amid a myriad of challenges, from surging demand to tightening inventories. Does President Joe Biden have a plan? Yes, and it potentially involves removing more supply from international energy markets and shutting down pipelines. But would this contribute to rising oil and gas prices? Exactly.
The Death of Another Pipeline?
Enbridge Line 5 is a component of a network that transports approximately 540,000 barrels of crude oil per day and other energy products from Western Canada to Michigan. During a recent media briefing, White House Deputy Press Secretary Karine Jean-Pierre confirmed that the administration is looking into replacing a part of the Line 5 oil and gas pipeline.
The Army Corps of Engineers started studying the pipeline this past summer. However, it received renewed attention after Politico reported that the president’s team has been assessing the possible impact that killing the Line 5 pipeline would have on energy markets.
Michigan has also considered shutting down a portion of the pipeline. Michigan Gov. Gretchen Whitmer (D) has been weighing the possibility of removing this segment because of concerns over possible oil spills in the Straits of Mackinac. But Republican lawmakers warn of the consequences this would have on U.S. households. Rep. Bob Latta (R-OH) said in a statement:
“As we enter the winter months and temperatures drop across the Midwest, the termination of Line 5 will undoubtedly further exacerbate shortages and price increases in home heating fuels like natural gas and propane at a time when Americans are already facing rapidly rising energy prices, steep home heating costs, global supply shortages, and skyrocketing gas prices.”
A dozen other legislators have urged President Biden to refrain from shutting down the pipeline, warning it would significantly increase energy prices and needlessly hurt millions of Americans.
One of the president’s first acts was ending the construction of the Keystone XL pipeline, a contentious project that would have created thousands of high-paying jobs. But the president insisted this was the right thing to do to help fight climate change. “Either way, our energy sector will continue to suffer as progressives claim more short-term victories in the name of political grandstanding under the new administration,” Liberty Nation’s Jose Backer opined in January.
Months later, it turns out that both the energy sector and the American people are paying the price for progressivism.
Energy Secretary: Good Luck This Winter!
Speaking in an interview with CNN over the weekend, Energy Secretary Jennifer Granholm conceded that the American people would be in store for a world of financial pain this winter as a result of skyrocketing gasoline prices. Put simply, U.S. households will be paying higher costs to heat their homes for the next few months. “This is going to happen,” she said. “It will be more expensive this year than last year.”
In October, the Energy Information Administration (EIA) forecast that homes relying on natural gas for heating could spend 30% more to keep warm this winter. But Granholm suggested the president’s recent trip to the COP26 climate summit would produce “immediate-term and long-term” solutions to this problem.
Reporters also pressed Jean-Pierre about potential options the administration could employ to help alleviate increasing energy prices. “We don’t have an announcement yet,” “We’re monitoring the prices,” “We’re making sure we have tools in our toolbox,” and “I don’t have anything specific here” were the responses that the White House spokeswoman provided to the media.
Will America Survive Old Man Winter?
Despite everything that Biden has done to undermine America’s energy prowess, the country will still be safe from the beating that Old Man Winter will lay upon much of the Northern Hemisphere. Domestic oil and gas firms are still producing approximately 11 million barrels of oil per day. The nation’s Strategic Petroleum Reserve (SPR) is north of 600 million barrels. Despite the Oval Office’s demonization of this so-called bridge fuel, America is rich in natural gas, and industry observers believe that exploration and production will intensify over the next couple of years.
Suffice it to say, the U.S. is in a better position than Europe, where the region has had to rely on its chief adversary, Russia, for its energy needs. President Biden may desire to depend on inefficient energy alternatives that have cracked under pressure, but the efficiency and prevalence of fossil fuels will be there for the country, even though it will cost more than many Americans have become accustomed to in recent years.
~ Read more from Andrew Moran.