While the whole world is consumed with the disastrous coronavirus pandemic, little attention is being paid to that sector of the economy whose existence had heretofore represented humanity’s greatest threat: the fossil-fuel industry. But now may be the best time to pay heed. Oil and gas prices recently fell so low that they bizarrely plummeted to negative values. This is an industry clearly in crisis, and therefore now is the perfect time for the climate-justice movement to strike.
Even before the Covid-19 pandemic, there was a massive glut of oil and gas. Supply was overwhelmingly large, and there was just not enough demand, which led to prices dropping extremely low. Then the coronavirus began spreading, and the declaration of a global pandemic caused a dramatically greater shutdown of the industry.
In city after city, the number of people commuting between home and work dropped sharply as leaders announced stay-at-home orders to curb the spread of the virus. A huge drop in the already-low demand pushed oil and gas prices to such depths that US President Donald Trump promised to intervene – so much for free-market capitalism. He made a big show of hosting oil and gas industry executives at the White House and has continued to pledge his support to a spectacularly profitable and hugely destructive industry.
Antonia Juhasz, a leading expert in the oil and gas sector and author of The Tyranny of Oil, explained to me in an interview that the recent drop in prices to negative numbers was “a complete crash of oil.” It meant that “producers are paying buyers to take oil from them. That is just because there was way too much product that the world is trying really hard to get off of.”
From the start of his presidency, Trump made the welfare of fossil-fuel companies his business. He embraced the dying coal industry, proudly holding up “Trump Digs Coal” signs at his political rallies, and claimed to save coal miners from what he said were unfair attacks by his predecessor Barack Obama. He filled his administration with oil and gas executives, dramatically deregulated the industry, and pushed for a massive expansion of offshore oil drilling.
But Trump is not the only US president to contribute to the frenzy of producing a product for which demand is falling. Obama, in making a bizarre case for natural gas obtained through hydraulic fracturing (fracking) as a “transition fuel,” promoted an industry that exacerbated the climate crisis.
Thanks to Obama – and some state-level leaders like former California governor Jerry Brown – a fracking boom in the United States led to overproduction. Juhasz explained that in fact the US fracking industry was already in debt before the Covid-19 crisis to the tune of $200 billion, and still the industry continued producing even as demand kept dropping.
This is clearly an industry that cannot and will not see the writing on the wall and enjoys political support to prop it up beyond its lifespan. Just as Frankenstein resurrected a dead man to life in the form of a monster, Trump has attempted desperately to revive fossil fuels. He has tweeted openly that he would “never let the great U.S. Oil & Gas Industry down.”
So desperate is Trump to save it that he has instructed the federal government to buy up to 92 million barrels of oil to fill up the Strategic Petroleum Reserve. The reserve is actually meant to help lower oil prices for American consumers when they are high, not as a way to bail out a dying industry.
Juhasz also highlighted another way in which the US government appears to be propping it up, saying, “We are forcing airlines to continue to fly as much as they were before Covid-19 even though ridership is down about 90%.” The airline industry is a huge consumer of fossil fuels, and Juhasz says she thinks that one of the reasons they are being told to keep flying is “because they are the lone consumer of jet fuel.”
The oil and gas industries in recent years have also attempted to pour their products into the plastics industry and were met with a growing grassroots movement to reduce plastic consumption through widespread bans of plastic bags and single-use plastic. Now, just as the industry is taking advantage of the pandemic to beg aggressively for a taxpayer-funded bailout, it is pushing to overturn those bans in municipalities around the US and profiting off the public’s fear of potential contamination of reusable bags.
This is a dying industry, desperate to extract from our soil and our ocean floors every last drop of fuel in order to remain alive long past its prime. It is an industry that has not only wreaked long-term havoc on the climate, but also caused deep and immediate damage through air and water pollution. Ten years ago, the worst marine environmental disaster in US history, the Deepwater Horizon oil spill, caused unimaginable damage to the Gulf of Mexico that is still being felt today.
What the coronavirus pandemic has demonstrated to us is that it is possible to lower fossil-fuel use dramatically and pull back from the abyss of rising emissions. There are two ways this pandemic will end – either by economies remaking themselves to sidestep the need for oil and gas, or for the industry to “roar back” by tapping into the massive supply that has been built up.
Already many are warning that our unpreparedness for the pandemic shows how little we are doing to ready ourselves for catastrophic climate change. Even former US secretary of state John Kerry says “the parallels [between the two disasters] are screaming at us.”
If we are to arise from the ashes of the Covid-19 crisis stronger and more resilient to future disasters, now is the time to pull the plug on an industry once and for all that has been on life support for too long.
This article was produced by Economy for All, a project of the Independent Media Institute, which provided it to Asia Times.