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Big Oil Firms Use War in Ukraine to Expand Fossil Fuel Production

Fossil fuel firms have found Russia’s invasion a convenient opportunity to undermine efforts to decarbonise the economy, reports Thomas Perrett

An oil refinery. Photo: Ashley Cooper/Cavan Images/Alamy

Big Oil Firms Use War in Ukraine to Expand Fossil Fuel Production

Fossil fuel firms have found Russia’s invasion a convenient opportunity to undermine efforts to decarbonise the economy, reports Thomas Perrett

Speaking at a recent UN Intergovernmental Panel on Climate Change (IPCC) session, Ukrainian representative Svitlana Krakovska connected the findings of the panel’s recent report to Russia’s invasion of Ukraine.

“Human-induced climate change and the war on Ukraine have the same roots: fossil fuels, and our dependence on them,” she said. “We will not surrender in Ukraine… And we hope the world will not surrender in building a climate-resilient future.”

The war in Ukraine has sparked widespread attempts to divest from Russian oil and gas, which currently makes up 40% of the EU’s imports.

Germany recently announced the closure of the Nord Stream 2 pipeline which imported oil from Russia, aiming to speed up the ratification of legislation which would double onshore wind energy volumes by 2028, ensuring that renewables constituted 80% of the nation’s energy supply.

However, the American fossil fuel industry has advocated for the expansion of domestic oil and gas as a solution to evading energy dependence on Russia. The American Petroleum Institute (API), a prominent trade association notorious for lobbying on behalf of heavily polluting industries, recently sent a letter to US Energy Secretary Jennifer Granholm which emphasised “the clear and present need for continued responsible investment in oil and natural gas development”. 

Exploiting a Crisis

Aiming to capitalise on the crisis in Ukraine to expand the power and influence of the oil and gas industry, the API’s letter criticised President Joe Biden’s administration for offering “a series of false solutions that fail to recognise the significant value of America’s abundant oil and natural gas as a strategic asset to strengthen energy security, economic growth, and environmental progress”.

It proposed a series of policies including expanding oil drilling in the Gulf of Mexico, ramping up sales of onshore drilling leases, and issuing more permits for oil and gas infrastructure.

These proposals would involve rolling-back some of Biden’s notable accomplishments – such as his executive order which prevented the construction of the Keystone XL Pipeline, which had been expected to carry 830,000 barrels of oil per day from Alberta to Nebraska. 

The API – which according to data from OpenSecrets, has spent more than $98 million on lobbying activities since 1998 – has a long history of undermining renewable energy efforts and publicly disputing the veracity of climate science, despite having been privately aware of the environmental implications of burning oil and gas since 1982.

That year, the API commissioned a Colombia University report which acknowledged that climate change could have “serious consequences for man’s comfort and survival”.

The report recognised the destructive implications of fossil fuel extraction, acknowledging that atmospheric CO2 levels were “expected to double some time in the next century”.

“Just when depends on the particular estimate of the level of increasing energy use per year and the mix of carbon-based fuels,” it added.

Yet 16 years later, a Greenpeace investigation discovered a ‘communications action plan’ published by the API, which opposed US involvement in the 1997 Kyoto Protocol – a UN climate convention designed to incentivise participants to reduce their greenhouse gas emissions – on the grounds that it would place the US at a “competitive disadvantage”.

Arguing that “the climate change theory being advanced by the treaty supporters is based primarily on forecasting models with a very high degree of uncertainty”, the API’s plan disputed that “so-called greenhouse gases” were caused by burning fossil fuels, stating that they had “many sources”.

A New Shock Doctrine

Following the COP26 conference last November – during which US President Biden made a number of rhetorical commitments to reducing America’s carbon emissions by 50-52% below 2005 levels by 2030 – the API has found in the Ukraine war a convenient opportunity to undermine efforts to decarbonise the economy.

The API arguably sees the war as an opportunity to promote a new ‘shock doctrine’ – described by academic Naomi Klein as a mechanism whereby powerful political and economic interest groups cynically weaponise public disorientation following cataclysmic events such as wars and humanitarian crises to impose control via exploitative, free-market policies.

Moreover, the API’s policy recommendations have led directly to high-profile Republican politicians demanding that President Biden use the war to resume domestic oil and gas extraction.

Just over a week after the API’s letter was sent, another letter addressing the ramifications of Russia’s invasion of Ukraine was delivered to President Biden – signed by several prominent Republican members of the US Senate. It advocated for many of the same policies as the API’s letter, arguing that Biden’s attempts to scale-back fossil fuel production had “left the US and our allies vulnerable to the malicious manoeuvrings of Vladimir Putin”. 

The letter, which implored the President to withdraw his executive order cancelling the Keystone XL Pipeline, called on him to approve new oil and gas leases on federal lands, by removing restrictions on the financing of natural gas and coal power plants.

Accusing Putin of “financing anti-fracking campaigns throughout Europe”, the letter argued that only the development of domestic shale gas, coal and oil could stave-off inflation and counteract Russian and Chinese geopolitical dominance.

David Armiak, research director at the Centre for Media and Democracy, an organisation which tracks the influence of money in politics and has extensively documented the actions of fossil fuel lobbyists, told Byline Times that he was unsurprised by the fossil fuel industry’s attempts to use the invasion of Ukraine as an excuse to promote dirty energy.

“API has consistently been the fossil fuel industry’s greatest advocate saying restrictions on oil production are bad for business,” he said. 


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Renewables Can Neutralise Power of Petrostates

Russia’s invasion of Ukraine, and the consequent restrictions which many countries have placed on Russian energy, could present an opportunity to develop reliable, sustainable domestic energy sources.

The expansion of solar and wind power could also protect domestic energy supplies, from rapid price fluctuations resulting from shocks to international markets.

Indeed, at a time when climate-induced extreme weather has pushed up gas prices causing a crisis in the cost of living, solar and wind power – both increasingly attractive investment prospects – could form the basis of a robust and self-sufficient economy.

The cost of solar PV modules has declined by 99.6% since 1976, and the cost per megawatt hour for both wind and solar stood at just $36 in 2021, compared to $60 for natural gas.

As a recent IPCC report has elucidated, “any further delay in concerted global action will miss a brief and rapidly closing window to secure a liveable future”. It is therefore imperative that oil and gas firms and their lobbyists are not given the opportunity to use geopolitical tensions as a pretext to roll-back crucial environmental protections, convincing elected officials that only domestic fossil fuel production can provide a counterweight to Russian oil and gas imports.

For David Armiak, the ability of Western nations to end their dependency on Russian energy imports “depends on how long and drawn out the Ukraine War is”.

“The longer it continues, the greater chance those Western countries that depend on Russian fossil fuels will need to look elsewhere,” he told Byline Times.

But Armiak recognises that transitioning to renewables will not be an immediately viable prospect for some nations. “Not all Western countries have focused on developing their renewable energy sector, so, in those cases, they will have to turn to domestic oil and gas, or will have to purchase oil and gas from another country,” he added.

The worldwide revulsion at Vladimir Putin’s invasion could entail a shift towards sustainable, reliable energy sources, which will enable us to both alleviate the impending climate crisis, and to curtail the mendacious influence of fossil fuel-powered tyrants.

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