Imagine being part of an industry bringing in record profits—nearly $174 billion in profits in 2021. You receive incentives to grow through taxes, you have benefits thrown at you through state incentives, you are able to work with people to split their surface and mineral property rights to grow when you need to if you want to find more places that can handle your business. Every indicator is coming up roses for you.
Consumer demand for your product is rising as COVID falls, and you decide now is the time to give back investors $36.5 bilion in compensation and nice bonuses, all while raising the price of your product. Care to take a guess about which industry it is?
Welcome to the oil industry. Over the last few years, we’ve all connected via Zoom, Microsoft Teams, or Google Meet. With travel resuming, oil and gas demand goes up, and the lack of planning by the industry in face of record profits leads to, well, them making more profits but everyone else feeling the pinch. Cars spin up and so do prices. Conservatives will tell you how much they love Elon Musk this week over his attempt to buy Twitter, while at the same time seemingly hating the sheer concept of electric vehicles. Who knows. The oil industry, though, won’t sweat it, and they aren’t the only ones profiteering right now.
For the American Petroleum Institute, the war in Ukraine has been an absolute gift. They are pushing for greater domestic drilling and more options in the U.S., at one point saying that fracking may be the best weapon the U.S. has against Russia. If you’re curious, you can find out where the oil and gas leases are near you through documents filed with your county, or through a land specialist. It took me minutes to find out that near me, hundreds of wells had been approved for potential drilling and … nothing. There is no movement to drill any of them. In fact, in counties all around me, that number of instilled wells skyrockets.
The United States is full of lease agreements with nothing happening—agreements held and agreed to in states and counties. If you believed the American Petroleum Institute, you would think they have nowhere to go and are all out of options. What may be more desirable is to get similar leases with way, way less oversight. Or maybe no oversight at all while combining it with products that have very little benefit to Americans looking for relief.
Americans will be looking at the ballot boxes this fall and wondering about their pocketbook. That is certainly reasonable. Under Trump, I frequently pointed out the president doesn’t control the price of gas; it is controlled by the industry. The same is certainly true now, and for the oil industry record profits right now are a great way for them to get fat and try to make it harm anyone who sees a more environmentally conscious future. A win-win, if you will.
There is an answer to that, and that is recognizing and talking about it for what it truly is: profiteering.
With that in mind, I hope you join us for our 20th anniversary Cheers & Jeers, 4PM PST on May 20! Just send me a KosMail to attend.
This week, instead of music, let me offer you some trailers for, let’s say, fitting movies:
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