This commentary originally appeared in Investor’s Business Daily on April 15, 2014.
President Obama’s tepid response to Vladimir Putin’s aggression in Ukraine overlooks the one trump card that this country, without brandishing a single weapon, could play: the geopolitical power of North America’s energy wealth.
As is widely reported, Putin effectively uses Russia’s abundant energy to intimidate Western and Eastern European countries dependent on Russia’s energy and to entice an oil-hungry China into a Russia-driven Eurasian ambit. Ukraine recently saw the price of natural gas from Russia increase by 80%.
Russia’s solvency, however, is precariously dependent on these energy sales. European countries rely on Russian exports of oil and natural gas to meet more than one-third of their demand. Russia depends on these exports for 25% of gross domestic product, 50% of government revenue and 70% of export income, according to The New York Times.
In geological fact, if not in prevailing White House policy, America is better situated than Russia to use energy as geopolitical leverage – a forceful but bloodless instrument of persuasion.
The U.S. has more energy resources than any other nation. Recently surpassing Russia, America is the largest producer of natural gas.
When all recoverable oil resources are considered, the U.S. oil supply approaches 2.5 trillion to 3 trillion barrels of oil, far in excess of Saudi Arabia or Russia.
Also known as the Saudi Arabia of coal, the U.S. has 261 billion tons of coal reserves. At the current rate of domestic consumption, America has enough coal to meet demand for 485 years.
Opening the door to development of North America’s prodigious energy resources could allow the U.S. and NATO countries to effectively neutralize Putin’s aggression.
But any concerted action to accelerate production of carbon-rich energy is evidently not in this president’s playbook.
To date, Obama has offered no more than lip service to energy in his response to Putin’s fist. Under existing law, the president could use his preferred phone and pen to expedite exports of natural gas to our allies in Western and Eastern Europe and to unlock long-shackled energy resources in the U.S.
Only one of the permits for more than 20 facilities to export liquefied natural gas (LNG) has received all the requisite federal approvals and is under construction on the coast of Louisiana. Exports could be sailing from this facility by the end of next year. This single export terminal, built by Cheniere Energy, has the capacity to handle one-sixth the volume of natural gas that Russia daily sends to Europe.
Full approval of the pending permits to export LNG and for the long-overdue Keystone pipeline would send a powerful signal right now. Instead, the president acts to impede rather than expedite a North American energy alternative to Russia’s most powerful geopolitical club.
Rather than overtly blocking energy development, the Obama administration uses indefinite administrative delays for permit approvals. A favored method is yet another “study” to review the project’s indirect global impact of greenhouse gas emissions in the next 50 years.
This fate recently befell the only export permit, other than Cheniere’s, already approved by the Energy Department.
The Environmental Protection Agency insinuated itself into the final – usually cursory – step in the process for approval by the Federal Energy Regulatory Commission.
It similarly inserted itself into the final approval for the international section of the Keystone pipeline – an authorization that could have been granted five years ago.
The EPA has no express authority to condition permits on speculative climate impacts across the world far into the future. Under the Clean Air Act and other laws, the agency’s jurisdiction is confined to this country.
Nonetheless, rather than reminding Europe and Putin of the energy clout of this country by approving export permits, the president on March 28 ordered his agencies to undertake yet another study to develop strategies – also known as regulations – to reduce methane emissions. Methane is the principal component of natural gas.
Obama appears ideologically and politically incapable of genuinely supporting America’s energy opportunities regardless of the economic benefits for this country or for the security needs of our closest allies.
To take full economic and geopolitical advantage of this country’s energy bounty, bold legislation is necessary.
Putin uses energy as a saber. The U.S. could use energy as a shield for our allies – a long-term strategy that portends colossal domestic and international benefits.
White is distinguished senior fellow and director of the Armstrong Center for Energy & the Environment at the Texas Public Policy Foundation. She was commissioner and chairwoman of the Texas Commission on Environmental Quality from 2001 to 2007.
“