Horowitz: America’s oil refinery crisis as the bottleneck to energy freedom



A third-world country was traditionally regarded as an undeveloped nation, which, unlike its first-world counterpart, lacks the resources to foster a prosperous economy. What we are confronted with under the Biden administration, however, is the coming of a “fourth-world” dynamic, where prosperous Western countries endowed by God with tremendous reserves of natural resources shun, destroy, and obstruct their own resources and punish their people with self-inflicted poverty.

In case anyone still thought leftists were pained by the unprecedented energy inflation, Biden made it clear that he views the destruction of cheap and effective energy as a blessing. "My mother had an expression: Out of everything lousy, something good will happen,” Biden told reporters in Rehoboth Beach on Monday. “We have a chance to make a fundamental turn toward renewable energy, electric vehicles, and across the board."

In other words, the obstruction of our boundless God-given oil, gas, and coal resources is not a natural disaster, but a controlled demolition in order to make us reliant on unsafe and ineffective energy, just as they used (or induced) the pandemic to make us reliant on unsafe and ineffective medical products and treatment. They are hell-bent on doing to our economy and energy sector what they have long succeeded in doing to health care. Just know: It didn’t have to be this way.

Aside from the war on drilling, fracking, and pipelines, the left is ensuring that oil refineries become the key bottleneck of our energy freedom, in their regulatory morass that keeps all forms of fuel prohibitively expensive. You can’t have gasoline or jet fuel without growing capacity among oil refineries, yet we haven’t built a new large refinery since the 1970s. Worse, Chevron CEO Mike Wirth ominously warned that he believes there will never be another oil refinery built ever again.

"Capacity is added by de-bottlenecking existing units by investing in existing refineries," Wirth explained at a conference earlier this month. "But what we’ve seen over the last two years are shutdowns. We’ve seen refineries closed. We’ve seen units come down. We’ve seen refineries being repurposed to become bio refineries. And we live in a world where the policy, the stated policy of the U.S. government is to reduce demand for the products that refiners produce."

"At every level of the system, the policy of our government is to reduce demand, and so it’s very hard in a business where investments have a payout period of a decade or more," Wirth said. "And the stated policy of the government for a long time has been to reduce demand for your products."

In other words, the declining oil refining industry is a self-fulfilling prophecy. The more the global oligarchs demand an end to fossil fuels and institute policies facilitating that goal, both on the supply and demand sides, the more it becomes impossible to obtain the long-term financing to invest in critical infrastructure.

This comes at a time when we already have the existing refineries shutting down due to age and the inane pandemic shutdown. Two weeks ago, a large Houston oil refinery operated by LyondellBasell Industries announced it would shut down its operations at the end of next year, which means we are slated to lose 200,000 barrels a day. The U.S. already suffered the closure of six refineries due to the lockdown, which cost us 800,000 barrels a day. Rather than rapidly increasing our crude oil distillation capacity every month, as we were doing for years, we are now about 1 million barrels per day off the pre-pandemic peak. However, because of the demand-side policies, the regulatory schemes, the carbon footprint financing regulations, and the ethanol mandates on small independent refiners, we will likely never recover.

The Biden administration has become so friendly to the ethanol mafia that it is setting the renewable fuel standard prohibitively high. This forces refiners, who inevitably can’t blend that much ethanol into the national fuel supply, to purchase ransom credits from the EPA, known as renewable identification numbers (RINs). Thus, not only is the greater pull to ethanol diluting the fuel and raising the cost of corn and fertilizer – both commodities at record highs – it is exacerbating the financial instability of our nation’s fragile and aging refining capacity. And that is exactly what Biden would call a blessing in disguise.

Who stands to benefit? As always, it’s China. Even though the U.S. has larger oil reserves than China, God’s blessing can’t be utilized if there is a man-made curse on recovery, delivery, and refining. China’s capacity is expected to surpass the U.S. this year for the first time ever – topping out at 18.8 million barrels per day, roughly the level we attained pre-pandemic under Trump. Thus, the oligarchs running our country are committed to doing to oil what they did to our coal production: making China the champion of both.

Just as with so many other issues, we can’t wait until 2025 to deal with this emergency of vital goods. Energy-wealthy states must take the initiative to spawn an energy boom. States like Texas should create their own strategic reserves and should also invite energy companies to build oil refineries by circumventing the insane regulations at the federal level. Instead, the current Texas government is planning to indulge the green boondoggle and add more electric vehicle charging stations throughout the state to support up to 1 million electric vehicles. After T. Boone Pickens pushed his wind-farm boondoggle in many Texas counties last decade, they are now being inundated with solar farms while they have so much oil and gas under their feet.

A true red state would regulate energy the way the FDA regulates Pfizer. After all, if that standard is good enough for our bodies, it’s good enough for our cars.

Biden released oil from strategic reserve to curb record-high gas prices. Now, some of that oil is going to Europe.



President Joe Biden promised that oil from the Strategic Petroleum Reserve would curb record-high gas prices. But some of that oil is now going to Europe.

What did Biden promise?

After gas prices skyrocketed to a national record of $4.33 per gallon in mid-March, Biden announced that 1 million barrels of crude oil will be released from the Strategic Oil Reserves per day for the next six months beginning in May.

"This is a wartime bridge to increase oil supply until production ramps up later this year. And it is by far the largest release from our national reserve in our history," Biden said. "It will provide a historic amount of supply for a historic amount of time — a six-month bridge to the fall."

What is happening now?

Bloomberg News reported this week that a cargo ship loaded with crude product from the U.S. Strategic Petroleum Reserves has departed a port in Texas bound for Europe.

Bloomberg reported:

A tanker known as the Advantage Spring loaded low-sulfur crude originally pumped from the strategic reserve caverns in Southwest Louisiana at a port in Nederland, Texas earlier this month, according to a person familiar with the matter. The ship, chartered by an affiliate of French energy giant TotalEnergies SE, is bound for the key European port of Rotterdam, according to ship-tracking data compiled by Bloomberg.

In fact, Biden recently offered to sell American oil from the petroleum reserves to countries that are highly dependent upon Russian energy and most at-risk to economic problems associated with cutting off the tap of Russian oil, Bloomberg noted.

Does it actually lower gas prices?

Last fall, Biden released 50 million barrels of oil from the Strategic Petroleum Reserve and released another 30 million barrels last month.

The expressed purpose of such releases is “to lower prices for Americans” at the gas pump, according to the White House.

However Stewart Glickman, an energy analyst at CFRA Research, told NBC News any price improvements related to the release are negligible at best.

“It might give you a little bit of short-term relief in the same way that taking some Advil will give you temporary relief from a headache,” he explained. “But the root cause of the headache is probably still going to be there, and that’s going to be sticking around long after the medicine’s worn off.”

Goldman Sachs analysts, meanwhile, described last November's release as but a mere "drop in the ocean."

The biggest factor mitigating the positive impact the petroleum release will have on gas prices is that 1 million barrels is only a small fraction of daily U.S. oil consumption.

According to the Energy Information Administration, the U.S. used approximately 20 million barrels of oil per day last year.

Horowitz: Biden’s plan to alleviate fuel crisis? Dilute the fuel supply even more with corn needed for food



One could not have conjured up a more odious and counterproductive policy than taking 40% of our corn supply and using it to dilute our fuel, thereby increasing the cost of both food and gas. Yet not only has the Biden administration declined to repeal the ethanol mandate during this unprecedented period of inflation and supply shocks, he will increase ethanol use in a way that will further deplete gas mileage for many motorists and place a greater demand on corn, which is the antecedent to the entire chain of food costs, with prices approaching record highs,

Ever since the pathetic mandate was implemented in 2005 and expanded in 2007, oil refiners couldn’t meet the arbitrary sum of billions of gallons of biofuels to blend into the nation’s fuel supply, even if they wanted to. For 2022, the mandate stands at 36 billion gallons. It’s not safe for engines to have a fuel blend of more than 10% ethanol, but for years the corn lobby was suggesting, in a quite self-fulfilling way, that the way to meet the mandate is by allowing more flexibility to blend “E15” all year round with no restrictions from the Clean Air Act. The real solution, though, is to abolish the original mandate.

Ideally, we should offer “E0.” We should repeal the mandate, which will save independent refiners, alleviate the artificial demand on corn prices and land use, and enjoy more miles per gallon of unadulterated fuel. Instead, the Biden administration has chosen to allow gasoline that uses a 15% ethanol blend, which is typically banned during the summer, to be sold throughout this year. Liberal Republicans like Iowa Sen. Chuck Grassley always pointed to the right to choose and be free to sell E15, but he and the corn lobby forget that we should be free to choose zero ethanol, and oil refiners shouldn’t be forced to blend it into the mix. If Grassley and his lobbyists want ethanol, they are welcome to blend E99 with their own refineries and sell it to people who want it without government intervention.

At a time when we should be allowing people to purchase fuel that achieves more miles per gallon, we are inevitably creating greater demand on gas and food at the same time! According to the Department of Energy, “Vehicles will typically go 3% to 4% fewer miles per gallon on E10 and 4% to 5% fewer on E15 than on 100% gasoline.” So that will wipe out any gain in price from using ethanol, which, for once, is slightly cheaper than gasoline, but only because of the war on fossil fuels. Also, because of the corrosive nature of ethanol, a higher blend will inevitably force gas stations to retrofit their pumps with new fuel dispensers and new underground storage tanks. Guess who will pay for that? What about when all the car owners who are tricked into using E15 blow through their warranties and public clamor forces us to bail them out?

And speaking of car owners, as our government makes oil refiners blend more ethanol, another equally absurd and harmful mandate runs head-first into the ethanol mandate: namely, the Corporate Average Fuel Economy (CAFE) standards. In order to serve the gods of the climate and limit the use of fossil fuels, Congress dramatically expanded the CAFE standards in 2007, forcing auto manufacturers to make expensive cars with paper-thin steel in order to comply with the green energy agenda and increase their miles per gallon (mpg) from 27.5 to 35. This was part of Energy Independence and Security Act of 2007, the same bill that expanded the ethanol mandate, which would later run into problems with the CAFE standards. Just as with the ethanol mandate, the EPA has created a trading credit system in which manufacturers can buy credits from competitors in exchange for not complying with the standard. According to the Heritage Foundation, “a 1 mpg tightening of the standard would cost consumers $7.81 billion annually.”

Fast-forward to last month, and the Biden administration announced its intent to increase the standard to 49 mpg by 2026, essentially barring non-electric cars. So not only will this make cars too expensive for the non-latte-sipping crowd, but it will run into the renewable fuels standard, because there won’t be enough demand for fuel to even meet that standard.

Meanwhile, independent refiners continue to get hammered, as the EPA just denied all of the 36 petitions from small refiners to exempt them from the biofuels standard for the 2018 compliance year. This is done by design to ensure that we don’t create more oil refineries. One could not possibly have conjured up a worse confluence of policies to increase the cost of food, fuel, and cars and destroy jobs in the energy sector. Yet that is likely a feature, not a bug, of their plan. Fewer cars and more expensive food and fuel grease the skids for more dependence on government and less freedom.

Another peculiar thing about the E15 decision is that the reason why the EPA typically bans its sale in the summer under the Clean Air Act is over concern that the higher blend creates more smog. Isn’t it interesting how environmental regulations can be waived to please the corn engine gods, but no such waivers are issued for oil, gas, and coal permitting, the Keystone pipeline, interstate pipelines, transporting liquid natural gas by rail, or drilling in the Gulf of Mexico? In fact, just as the energy crisis was reaching its climax, the Securities and Exchange Commission (SEC), without the approval of Congress, issued a rule that will require all publicly traded companies to disclose the effects of their operations on “climate change.” This rule will make Dodd-Frank and Sarbanes-Oxley look easy and is designed to cripple the fossil fuels business.

Therefore, don’t be fooled by the recent band-aids placed on our energy ailment created by the Biden administration, such as the move to release more oil from the Strategic Petroleum Reserve. These are temporary political maneuvers to give the impression they are concerned about the consumer while they tighten the noose on fossil fuels, diminish our freedoms, and pay off their well-connected cronies. You might not be able to afford corn for your chickens, but you will have lots of it in the engines of your $50,000 compact cars.

Biden unveils new plan to target, punish oil companies for gas crisis he blames on Putin



President Joe Biden is asking Congress to punish oil companies for allegedly placing profits over oil production.

The allegations are the latest development in Biden's total abdication of any responsibility for the gas price crisis. Energy experts say the Biden administration's hostile policies are playing some role in the crisis, but the White House blames Russian President Vladimir Putin and oil companies.

While Russia's invasion of Ukraine undoubtedly shook the oil market, the White House has blamed oil companies for not using as many as 9,000 approved oil leases. White House press secretary Jen Psaki was making that claim before the war.

What are the details?

In an announcement, the White House pushed blame for the gas price crisis on oil companies, claiming they are putting profits over production.

"[T]oo many companies aren’t doing their part and are choosing to make extraordinary profits and without making additional investment to help with supply," the White House said in a statement.

To stop oil companies from their alleged profiteering, Biden wants Congress to impose fees on companies for not using approved leases.

"Today, President Biden is calling on Congress to make companies pay fees on wells from their leases that they haven’t used in years and on acres of public lands that they are hoarding without producing," the statement said.

"Companies that are producing from their leased acres and existing wells will not face higher fees," the White House continued. "But companies that continue to sit on non-producing acres will have to choose whether to start producing or pay a fee for each idled well and unused acre."

But what is the problem?

Three significant problems exist with the White House's claims.

First, while the oil industry is highly lucrative, it is also volatile. Although major oil companies measure annual revenue in the tens of billions of dollars, the same measuring standard applies to losses. In fact, the world's biggest integrated oil companies — ExxonMobil, BP, Shell, Chevron, and TotalEnergies — lost more than $70 billion in 2020. That means gains in 2021 essentially offset losses from the previous year.

Second, many oil companies, while making investments in renewable sources, are slowing investments in fossil fuels because the U.S. government is enacting policies that are increasingly hostile toward oil. Why would a company make additional investments in oil, like the White House's statement indicates the Biden administration wants, if U.S. policy makes oil production untenable?

Third, not every approved oil lease is viable. In fact, the process of finding, acquiring, and developing oil under an approved lease is a lengthy one — only if oil exists under the land for which a lease is approved. To make matters worse, leases are often hung up by litigation and bureaucratic red tape.

Anne Bradbury — CEO of the American Exploration & Production Council, a national trade organization that represents oil companies — has called the White House's accusation a "red herring."

"It's really a distraction from the fact that this administration has paused leasing on federal lands, something that we're concerned about and something that we think needs to continue right away," Bradbury told Fox Business. "The fact is that industry is producing at a higher level on existing leases on federal lands than in the last 20 years and these leases take many years to explore, to develop and produce on."

Biden says energy crisis is 'opportunity' to advance his green energy agenda, to 'switch from fossil fuels'



"Never let a serious crisis go to waste."

British Prime Minister Winston Churchill allegedly uttered those words during World War II. Democrat Rahm Emanuel cemented the adage as a pejorative in American political discourse when he said, "You never want a serious crisis to go to waste. And what I mean by that is an opportunity to do things that you think you could not do before."

On Friday, President Joe Biden invoked that mentality when he appeared to celebrate the current global energy "crisis" as an "opportunity" through which he can advance his clean energy agenda.

What did Biden say?

Biden announced a new initiative with the European Union that has two goals: First, reduce Europe's reliance on Russian energy; and second, reduce overall dependence on fossil fuels, which the Biden administration hopes to do because these are not "clean" energy sources.

Biden's remarks were made during a joint press conference with European Commission President Ursula von der Leyen.

"This crisis also presents an opportunity. It’s a catalyst that will drive the investments we need to double-down on our clean energy goals and accelerate progress toward our net-zero emissions future," Biden said.

"That’s what the second part of this initiative is all about," he explained. "The United States and the European Union are going to work together to take concrete measures to reduce dependence on natural gas — period — and to maximize the availability and use of renewable energy. We’re going to accelerate widespread adoption of energy-efficient technologies and equipment, like smart thermostats, and work to electrify heating systems all across Europe.

"We’re going to invest in innovative solutions and technologies to make the switch from fossil fuels," Biden declared. "And together, we’ll advance the use of clean and renewable hydrogen to reduce our carbon emissions."

President Biden and European Commission President Ursula von der Leyen Make a Joint Press Statementyoutu.be

Biden's rhetoric matches what Americans have heard from other senior members of the Biden administration.

Infamously, Vice President Kamala Harris and Transportation Secretary Pete Buttigieg told Americans strained by record high gas prices that purchasing expensive electric cars could help alleviate their problems.

House Democrat declares it is 'un-American' to blame Biden for gas crisis: 'This is Putin's fault'



Democratic Rep. Kim Schrier claimed Monday that bucking the Biden administration's narrative on the intensifying gas price crisis is "un-American."

What is the narrative?

The Biden administration launched a full-court press last week blaming Russian President Vladimir Putin for soaring gas prices and out-of-control inflation.

The problem, of course, is that inflation rates were already at historic highs and gas prices were already sky-high before Russia launched its full-scale invasion of Ukraine in late February.

What did Schrier say?

During an interview with journalist Brandi Kruse, the Washington Democrat regurgitated the Biden administration's talking points and charged that dissenters are "un-American."

"I believe a couple things: Right now, in the last two weeks, this is Putin. You should be blaming Putin if anybody for this," Schrier said. "To not blame Putin, first of all, is denying reality, and second, frankly, I think is un-American."

"So, this is Putin's fault," she declared.

Strangely, Schrier then immediately blamed the COVID-19 pandemic and supply problems — just as the Biden administration did before Putin invaded Ukraine.

"Before this because people were already suffering at the gas pump before this, right? We saw an increase of over $1/gallon over the past year and a half or so, that can be blamed realistically on— during the pandemic, when people were not going to work and driving was down, gas prices were down," she claimed. "As demand increased and rigs had not yet been turned on, there was a supply-demand issue like with everything else in this country, and that was to blame."

U.S. @RepKimSchrier (D-WA) says it is "frankly un-American" to blame record gas prices on anyone but Putin: https://www.patreon.com/posts/un-divided-17-63766225\u00a0\u2026 #unDividedpic.twitter.com/RnG6FrL2k6
— Brandi Kruse (@Brandi Kruse) 1647284354

While Biden has abdicated any responsibility for the problem with gas prices and vulnerable Democratic lawmakers have indicated they will happily repeat Biden talking points, Biden recently bragged about dropping gas prices.

"I was able to bring it down 12 cents a gallon and will come down more, I believe," Biden said in December 2021.

The national average gas price as of Tuesday afternoon is $4.31 per gallon, according to AAA. That figure is down four cents from Monday, but still up since last week.

Democrats break ranks, demand Biden increase domestic oil production as he looks to Venezuela and Saudi Arabia



Democratic lawmakers are increasingly breaking with their party's narrative on fossil fuels as Americans face a growing oil crisis.

What do Democrats believe?

The Democratic Party's official 2020 platform committed to "combatting the climate crisis and pursuing environmental justice."

For years, Democrats have blamed fossil fuels for contributing to climate change and have advocated moving America's energy needs to renewable sources to slow the impacts of climate change. Doing so would require decreasing dependence on oil, coal, and gas, while increasing reliance upon solar, wind, hydro, and nuclear energy sources.

But what are some Democrats saying?

A group of Texas Democrats sent President Joe Biden a letter Tuesday calling on him to "unleash" American production of energy sources to "counter reliance on Russian oil and gas."

The letter — signed by Reps. Vicente Gonzalez, Sylvia Garcia, Henry Cuellar, and Filemon Vela — demanded that Biden send a "strong signal" to the world "that the United States will be a reliable producer and supplier of oil and natural gas for the foreseeable future."

Among the practical steps that Biden should take, the lawmakers said the president should "promote long-term American energy production," and they called on him to direct federal agencies to adopt policies empowering American energy producers.

"Domestic energy producers, refiners, and exporters are ready, willing, and able to work with your administration to give our allies access to a reliable source of energy and provide relief to American consumers," the lawmakers wrote. "We cannot wait for tomorrow to do what needs to be done today. We must unleash responsible domestic production to counter reliance on Russian oil and gas, while simultaneously cutting off Russia’s largest source of revenue. Now is the time to regain our energy independence and support our allies around the globe."

Two Democratic senators — Jon Tester (Mont.) and Joe Manchin (W.Va.) — also renewed calls on Tuesday for American companies to ramp up domestic production.

"We shouldn’t be advancing other countries that don’t share our values," Tester told CNN. "So, I think the opportunity here is to do it domestically, create jobs here, deal with it domestically, and also see if we can help Europe out, too."

Manchin said, "We should basically go back to the policies that we’ve had before. We have to do our leasing in the Gulf [of Mexico], OK, [Bureau of Land Management] lands have been off-target, all this has to go back into production. That’s all we’re asking for. And if we’re asking the rest of the world to step up, let’s show that we’re going to step up. And any oil that’s needed to our allies around the world, we produce it cleaner than anybody.”

Tester, Dem from Montana, on talk of importing Venezuelan and Iranian energy to offset Russian ban: "We shouldn't be advancing other countries who don't share our values."\n\nManchin: "If we are asking the rest of the world to step up, let's show that we're going to step up."pic.twitter.com/KHYeNYqoGF
— Manu Raju (@Manu Raju) 1646756238

Despite pleas from his own party, Biden has not signaled that he will urge American oil producers to help alleviate the growing energy crisis.

In fact, the Biden administration is reportedly looking internationally — to Venezuela and Saudi Arabia — to help meet American oil needs.

Meanwhile, deputy national security adviser Daleep Singh claimed Wednesday that even if American producers maximized their drilling capacity, the price of gas would be unaffected.

"That's why we have resolved to speed our transition toward cleaner, more sustainable, and renewable sources of energy," Singh said.

Sen. Ted Cruz aligns himself with Elon Musk's demand to increase American oil and gas output: 'Unleash American energy now!'



Sen. Ted Cruz (R-Texas) announced his support for Tesla and SpaceX CEO Elon Musk's viral social media post calling for America to immediately increase its domestic energy source output.

What's a brief history here?

Musk on Friday took to Twitter to speak out about the necessity of increasing domestic oil and gas output to combat the dramatically surging energy prices under the Biden administration and as Russia continues to invade Ukraine.

Musk wrote, "Hate to say it, but we need to increase oil & gas output immediately. Extraordinary times demand extraordinary measures. Obviously, this would negatively affect Tesla, but sustainable energy solutions simply cannot react instantaneously to make up for Russian oil & gas exports.”

At the time of this reporting, Musk's tweet has been liked more than 197,000 times.

Obviously, this would negatively affect Tesla, but sustainable energy solutions simply cannot react instantaneously to make up for Russian oil & gas exports.
— Elon Musk (@Elon Musk) 1646441339

What's happening now?

Cruz took to Twitter on Saturday to support Musk’s statement, saying, “Couldn’t agree more! Unleash American energy NOW!”

"Couldn't agree more! Unleash American energy NOW!" he tweeted.

Couldn't agree more! Unleash American energy NOW!https://twitter.com/elonmusk/status/1499907549746937860\u00a0\u2026
— Ted Cruz (@Ted Cruz) 1646487978

What else?

Cruz on Friday issued a statement regarding the Energy Freedom Act, which would effectively release the U.S. from reliance on foreign energy sources.

“I’m introducing the Energy Freedom Act to reverse Biden’s actions so we can restore American energy independence," he said in a statement on the proposed legislation. "This bill won’t cost taxpayers a dime, but it will provide the United States billions in revenue in the coming years by expediting permitting, leasing, safe new pipelines, and exports, and providing much needed regulatory certainty. It would create new jobs, lower energy costs, and because modern energy production in the United States is far cleaner than in any other country’s by every measure, it would help the environment."

He added, "The Energy Freedom Act would put a stop to the Biden administration’s sabotage of the American energy industry, and Congress should take it up without delay.”