U.S. Fuel Exports To Profit Industry, Slam Consumers

A Trump administration rush to export natural gas and oil from the U.S. is likely to harm U.S. consumers by raising the prices for home heating, electricity and even gasoline, according to an earlier Department of Energy analysis. Photo: U.S. Department of Energy via Flickr Creative Commons (U.S. government work).

Issue Backgrounder: U.S. Fuel Exports To Profit Industry, Slam Consumers

By Joseph A. Davis

Donald Trump’s “drill, baby, drill” rush could lead to a surprise ending in world energy markets. And U.S. consumers may not find it a happy one.

Weeks into Trump’s second term in office, swift approvals were given for one new export terminal for liquified natural gas and another for oil export. That’s just for starters.

You would not know, by listening to the president, that this rush is likely to harm U.S. consumers by raising the prices they pay for home heating, electricity and even gasoline. Unless you read a penetrating New York Times piece (may require subscription) by Lisa Friedman and Coral Davenport.

The pair were reporting on an analysis from outgoing Energy Secretary Jennifer Granholm, a last-gasp justification of the Biden administration’s effort to slow the permitting of oil and gas exports.

Granholm said in the statement that the pace of export approvals is “neither sustainable nor advisable.” U.S. exports of natural gas had tripled over the last five years, are expected to double by 2030 and could double again based only on new terminals that have already been approved, she wrote.

 

The Biden administration had frozen

approvals of gas export permits.

The incoming Trump administration

immediately revoked that freeze.

 

The Biden administration had frozen approvals of gas export permits while the Department of Energy studied their economic and climate implications. The incoming Trump administration immediately revoked that freeze.

There are about a dozen more gas export proposals still waiting in line for approval. Approval will come. And that means a big (and growing) fraction of U.S. gas will be going abroad.

And that means less gas supply for U.S. customers — which means higher domestic gas and electricity prices. Granholm said domestic natural gas prices would rise by over 30%.

 

Europe’s dependence on Russian gas

Before the Russian war on Ukraine, many European nations were dependent on gas exported from Russia, often by pipeline.

In response to Russia’s attack, the NATO alliance imposed an array of economic sanctions on Russia — with drastic cutbacks in European imports of natural gas being key among those sanctions, which were imposed in February 2022.

That brought on huge worries in NATO countries about how they could meet their energy needs. But Europe did manage to get through some cold winters and eventually found alternate supplies.

Enter the U.S. gas industry — the rescuing hero.

U.S. gas producers were glad to step in and make money selling Europe their glut of gas as a patriotic gesture to save needy allies from Russian extortion. Never mind the climate impacts of continuing to burn fossil methane.

The problem was that the infrastructure was just not there, we heard U.S. gas companies say. But it turned out that the missing infrastructure was at U.S. ports, more than European ones.

What followed was a rash of plans, proposals and pipe dreams for exporting U.S. gas as liquid natural gas.

 

Trump’s call for ‘energy dominance’

“Energy dominance” is a phrase Trump used during the campaign. But what does he mean by it?

If any meaning can be found in the phrase, we might look for it in Trump’s Feb. 14 executive order, “Establishing The National Energy Dominance Council.”

That document states: “We must expand all forms of reliable and affordable energy production to drive down inflation, grow our economy, create good-paying jobs, reestablish American leadership in manufacturing, lead the world in artificial intelligence, and restore peace through strength by wielding our commercial and diplomatic levers to end wars across the world.”

Except it turns out that the U.S. already has “energy dominance.”

 

The U.S. is the world’s largest oil producer

— and has been for the past seven years.

Larger than Saudi Arabia or Russia.

 

It’s a fact that today the U.S. is the world’s largest oil producer — and has been for the past seven years. Larger than Saudi Arabia or Russia. We produce about 21.91 million barrels of oil per day, or about 22% of the world's total oil production. We consume about 20.3% of the world's total oil production.

Not only that, but the U.S. is also the world’s largest natural gas producer and the world’s largest natural gas exporter.

Yet Trump’s Feb. 14 order talks of the need to “reduce our dependency on foreign imports.” (Most of which come from our neighbors Mexico and Canada.)

The Energy Dominance Council will consist mainly of cabinet secretaries — which can be taken as a warning for them not to do anything at their agencies to slow U.S. oil and gas production.

And it will be headed by Interior Secretary Doug Burgum, who oversees most drilling on U.S. public lands (onshore and offshore) and, as we reported earlier, is a leading surrogate for “energy dominance.”

[Editor’s Note: For more, see our 2024 Backgrounder on how LNG is expected to fuel conflict, profit and global warming in coming years. Also see an earlier TipSheet on concerns over LNG rail transport. And for more on energy-related issues, visit our Topic on the Beat: Energy page, with the latest SEJournal stories, plus energy headlines from EJToday.]

Joseph A. Davis is a freelance writer/editor in Washington, D.C. who has been writing about the environment since 1976. He writes SEJournal Online's TipSheet, Reporter's Toolbox and Issue Backgrounder, and curates SEJ's weekday news headlines service EJToday and @EJTodayNews. Davis also directs SEJ's Freedom of Information Project and writes the WatchDog opinion column.

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* From the weekly news magazine SEJournal Online, Vol. 10, No. 13. Content from each new issue of SEJournal Online is available to the public via the SEJournal Online main page. Subscribe to the e-newsletter here. And see past issues of the SEJournal archived here.