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An ExxonMobil oil refinery, the second largest in the U.S., is pictured on February 28, 2020 in Baton Rouge, Louisiana. (Photo: Barry Lewis/InPictures via Getty Images)

Beware the American Big Oil Oligarchs Ready to Profit Off Ukraine War

Will Republicans rally unconditionally to Ukraine's side if it costs us more at the gas pump and raises the price of home heating oil?

Thom Hartmann

Ukrainian Member of Parliament Oleksandra Ustinova asked this morning how many Ukrainian deaths do Americans have to see on TV before we stop funding Putin by buying his oil?

This issue of blocking Russian oil imports—particularly if it raises gas prices at the pump here—puts Biden in a political bind, and Republicans appear to be salivating at the prospect. 

I'd add, how many Ukrainian deaths do we have to see on TV before Republicans stop using the Russian invasion of that country to promote the interests of American petrobillionaire oligarchs?

Germany's economic minister Robert Habeck yesterday told Deutschlandfunk radio that Germany has now positioned itself to decouple altogether from Russian oil and gas imports.  Just two weeks ago this would have been unthinkable, with about 40 percent of Germany's imported gas and oil coming straight from Russia.

"We are prepared for that [now]," Habeck said. "I can give the all-clear for the current winter and summer."

He added that the three nuclear power plants scheduled to be switched off in the next year can be left running for the time being, and several coal-fired power plants that have been retired can be brought back online with minimal disruption. 

Doing so means, Habeck said, "We will have to buy more gas, but also coal from other countries" which will inflate the cost of transportation and home heating, but the majority of Germans think that's a small price to pay to stop funding the assault on Ukraine.

Fortunately for Minister Habeck and German Chancellor Olaf Scholz, the German Supreme Court has not ruled that it's "First Amendment-protected Free Speech" for fossil fuel billionaires to own German politicians and direct their behavior in exchange for campaign contributions and other favors. 

To the contrary, such behavior is explicitly illegal in Germany, where much of the cost of campaigning for elections is federally funded.

Here in America, however, since five radicals on the Supreme Court grifted us with their Citizens United decision, pretty much the entire GOP and a few Democrats (famously Sinema and Manchin) have been purchased by multiple industries, particularly Big Pharma, Big Insurance, Big Banking and Big Oil.

As a result, multiple Republicans (and a few Democrats) are calling for an end to Russian imports to the US to be "balanced" by President Biden opening more federal lands to oil exploitation and for the revival of the Keystone XL Pipeline to bring dirty oil tar from Canada to refineries on the Gulf Coast to process and export most of the resulting gasoline and diesel fuel (we get the pollution, they get the profits).

This sales pitch is desperately disingenuous—they all know it would take years for additional fossil fuel to come online and the XL pipeline was mostly for export—but its simplicity appeals to low-information voters and "news" agencies like Fox that have little to no regard for either nuance or truth on issues that benefit billionaires.

Russia exports around 5 million barrels of crude oil a day (12% of the world's total), earning them, at $100+/barrel, around a half-billion dollars a day in foreign "hard" currencies (mostly dollars); the US is currently buying a bit over 100,000 barrels a day of that, giving Russia a bit over $10 million a day at the current price of oil.

American oil imports from Russia were historically negligible, until oil CEOs George W. Bush and Dick Cheney took over. In the years since then we've imported as much as 400,000 barrels a day from Russia.

President Biden correctly pointed out that if the US were to cut off all our imports of Russian oil the effect on Russia would be negligible; in addition, many of those imports may dry up all by themselves over the next few weeks as the companies bringing in Russian oil find it harder and harder to make payments to Russian banks.

Nonetheless, blocking Russian fossil fuel imports to the US would be an example of "putting your money where your mouth is" that the world would notice. And it would put us in line with our allies who appear on the verge of the same step.

And it wouldn't be that radical a step. The simple reality is that because of Biden administration efforts to make America more energy independent, January saw close to zero—yes, almost zero—imports of Russian oil into the US, and those that came in last month and will dock this month were both ordered and paid for before Russia invaded Ukraine. 

Russian oil pretty much exclusively goes to high-sulfur-tolerant older refineries on the east and west coasts that were built back before Texas Sweet Crude, Gulf Coast platform-drilled, and fracked low-sulfur oil came online in much large quantities over the past few decades.

But this issue of blocking Russian oil imports—particularly if it raises gas prices at the pump here—puts Biden in a political bind, and Republicans appear to be salivating at the prospect. 

The last president who asked Americans to sacrifice because of a worldwide oil crisis (caused, in that case, by the echo of the Arab Oil Embargo) was Jimmy Carter. 

His suggestion people turn their thermostats down a few degrees and wear sweaters was met with howls of ridicule and claims of "weakness" and "malaise" from Republicans, and contributed to his loss to Reagan in 1980.

Republicans, as mentioned earlier, are already lining up to demand that both Biden drop Russian oil and "replace it" (even though it would take years) with Keystone XL or other "domestic" oil, rather than demanding we speed up the build-out of renewable sources, which are all now cheaper and more rapidly deployable than any fossil fuels and don't contribute to global warming.

Biden is thus reasonably wary of the politics of cutting off Russian oil as gas prices are rising.  

It's the right thing to do, just like Jimmy Carter's asking us to wear sweaters was, at the time, the right thing to do.  But the political consequences could be severe if the Republicans decide winning the next election is more important than doing the right thing for America and Ukraine.

Will Republicans rally to Biden's side if he says the price to all of us of supporting Ukraine is rising prices at the gas pump and in home heating? 

The Germans are good with it, but they've seen what happens—in the living memory of many of them—when an unaccountable autocrat decides violence is the best way to get what he wants. And their politicians aren't "owned" by German petrobillionaires: that type of corruption that's now widespread in America is illegal in Germany.

Will the Republicans support America, or will they put Party over country and use Biden's embargo (if he does it) as a political weapon to trash Democrats this fall? 

And if Biden does block Russian oil imports and tries to replace them with green energy instead of more offshore oil, will the fossil fuel billionaires use that action as an excuse to mobilize a new Astroturf Tea Party-like "movement" like they did to try to block Obamacare?

It's not a bet I'd want to take. 

This article was first published on The Hartmann Report.


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