Energy
House votes to block China from buying oil from US reserves
By Matthew Daly in Washington
WASHINGTON (AP) — The Republican-controlled House on Thursday voted to block oil from the country’s emergency stockpile from going to China.
The bill, one of the first introduced by the new GOP majority, would prohibit the Energy Department from selling oil from the Strategic Petroleum Reserve to companies owned or influenced by the Chinese Communist Party. It passed easily, 331-97, with 113 Democrats joining unanimous Republicans in support.
Rep. Cathy McMorris, R-Wash., the new head of the House Energy and Commerce Committee, said the bill would help end what she called President Joe Biden’s “abuse of our strategic reserves.”
Biden withdrew 180 million barrels from the strategic reserve last year in a bid to halt rising gasoline prices amid production cuts by OPEC and a ban on Russian oil imports following Moscow’s invasion of Ukraine. The monthslong sales brought the stockpile to its lowest level since the 1980s. The administration said last month it will start to replenish the reserve now that oil prices have gone down.
McMorris Rodgers accused Biden of using the reserve to “cover up his failed policies” that she said are driving up energy prices and inflation.
“Draining our strategic reserves for political purposes and selling it to China is a significant threat to our national and energy security. This must be stopped,” McMorris Rodgers said.
The measure is the first in a series of GOP proposals aimed at “unleashing American energy production,” McMorris Rodgers said as Republicans seek to boost U.S. production of oil, natural gas and other fossil fuels.
“There’s more to come. This is just the beginning,” she said.
Democrats, including former Energy and Commerce Chairman Frank Pallone of New Jersey, said Republicans were trying to fix a problem of their own making. China is among numerous potential adversaries that buy U.S. oil after the GOP-led Congress lifted an export ban in 2015.
“If Republicans were serious about addressing this issue, they would have brought forward a bill that banned all oil exports to China,” Pallone said, adding that sales from the strategic reserve amounted to about 2% of U.S. oil sold to China last year.
“If we truly want to address China using American oil to build its reserves, let’s actually take a serious look at that, rather than skirt around the issue because Republicans are scared of Big Oil’s wrath,” Pallone said.
The current process allows for crude oil sales from the strategic reserve to companies that make the highest offer, which includes U.S. subsidiaries of foreign oil companies, and they could then export that crude oil overseas. Last year, millions of barrels of oil from the U.S. reserves wound up being exported to China, including to a subsidiary of China’s state-run oil company, Sinopec.
The Energy Department said in a statement Thursday that Biden “rightly authorized emergency use” of the strategic reserve, also known as the SPR, to address supply disruptions and “provide relief to American families and refineries when needed the most.”
The Treasury Department estimates that release of oil from the emergency stockpile lowered prices at the pump by up to 40 cents per gallon. Gasoline prices, meanwhile, averaged about $3.27 per gallon on Thursday, down from just over $5 per gallon at their peak in June, according to the AAA auto club.
“By law we are required to select the highest value bid to ensure the best return for taxpayers, and since 2017 the vast majority of oil sold from the reserve is sold to American entities,” the Energy Department said. Over the last five years, less than 3% of oil from the strategic reserve has gone to China, officials said.
The House bill now goes to the Democratic-controlled Senate. Sen. John Barrasso, R-Wyo., has introduced a similar measure.
From the Fraser Insitute
Contrary to claims by many climate activists and politicians, extreme weather events—including forest fires, droughts, floods and hurricanes—are not increasing in frequency or intensity, finds a new study published today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
“Earth Day has become a time when extraordinary claims are made about extreme weather events, but before policymakers act on those extreme claims—often with harmful regulations—it’s important to study the actual evidence,” said Kenneth Green, a senior fellow with the Fraser Institute and author of Extreme Weather and Climate Change.
The study finds that global temperatures have increased moderately since 1950 but there is no evidence that extreme weather events are on the rise, including:
• Drought: Data from the World Meteorological Organization Standardized Precipitation Index showed no statistically significant trends in drought duration or magnitude—with the exception of some small regions in Africa and South America—from 1900 to 2020.
• Flooding: Research in the Journal of Hydrology in 2017, analyzing 9,213 recording stations around the world, found there were more stations exhibiting significant decreasing trends (in flood risk) than increasing trends.
• Hurricanes: Research conducted for the World Meteorological Organization in 2019 (updated in 2023) found no long-term trends in hurricanes or major hurricanes recorded globally going back to 1980.
• Forest Fires: The Royal Society in London, in 2020, found that when considering the total area burned at the global level, there is no overall increase, but rather a decline over the last decades. In Canada, data from Canada’s Wildland Fire Information System show that the number of fires and the area burned in Canada have both been declining over the past 30 years.
“The evidence is clear—many of the claims that extreme weather events are increasing are simply not empirically true,” Green said.
“Before governments impose new regulations or enact new programs, they need to study the actual data and base their actions on facts, not unsubstantiated claims.”
- Assertions are made claiming that weather extremes are increasing in frequency and severity, spurred on by humanity’s greenhouse gas emissions.
- Based on such assertions, governments are enacting ever more restrictive regulations on Canadian consumers of energy products, and especially Canada’s energy sector. These regulations impose significant costs on the Canadian economy, and can exert downward pressure on Canadian’s standard of living.
- According to the UN IPCC, evidence does suggest that some types of extreme weather have become more extreme, particularly those relating to temperature trends.
- However, many types of extreme weather show no signs of increasing and in some cases are decreasing. Drought has shown no clear increasing trend, nor has flooding. Hurricane intensity and number show no increasing trend. Globally, wildfires have shown no clear trend in increasing number or intensity, while in Canada, wildfires have actually been decreasing in number and areas consumed from the 1950s to the present.
- While media and political activists assert that the evidence for increasing harms from increasing extreme weather is iron-clad, it is anything but. In fact, it is quite limited, and of low reliability. Claims about extreme weather should not be used as the basis for committing to long-term regulatory regimes that will hurt current Canadian standards of living, and leave future generations worse off.
Author:
The Fraser Institute is an independent Canadian public policy research and educational
organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global
network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians,
their families and future generations by studying, measuring and broadly communicating the
effects of government policies, entrepreneurship and choice on their well-being. To protect the
Institute’s independence, it does not accept grants from governments or contracts for research.
Visit www.fraserinstitute.org
From the Fraser Institute
In the face of heavy opposition from Canada’s premiers to Prime Minister Trudeau’s carbon tax, one might have hoped that the prime minister would moderate some of his government’s extreme climate policies. But alas, on a recent swing through Alberta, he threw cold water on any hope of moderation.
When asked in a meeting with a who’s who of Alberta’s energy sector if he might drop the forthcoming cap on greenhouse gas emissions specific to the oil and gas industry, Trudeau reportedly replied “not a chance.” That’s a shame, because it was an opportunity for Canada (and Alberta) to dodge another bullet aimed at its economic heart, and an opportunity to reduce some of the rancor between the West and Ottawa.
And in fact, there are many good reasons to drop the GHG cap.
In a recent report, the Conference Board of Canada estimated oil and gas production cuts due to the cap would lead to a permanent decline in Canada’s real GDP of between 0.9 per cent (the report’s most likely outcome) to 1.6 per cent (its least likely outcome) relative to the baseline in 2030. Which means a loss of $22.8 billion to $40.4 billion in 2012 dollars. In Alberta, real GDP by between 3.8 per cent and 6.7 per cent (or $16.3 billion to $28.5 billion). These are devastating impacts, hand-waved away by the prime minister.
Moreover, the report estimates total employment declines nationally by between 82,000 and 151,000 in 2030. A large part of this unemployment will land in Alberta where the report estimates total employment in the province would decline by between 54,000 and 91,500 jobs. And between 2030 and 2040, employment in Alberta will be between 66,300 and 102,600 lower per year (on average). Again, these are huge economic damages disregarded by the prime minister.
Lastly, as shown in a 2023 study published by the Fraser Institute, even if the proposed cap achieved the emissions reductions government predicts, the reduction would equal four-tenths of one per cent of global emissions, a reduction unlikely to have any impact on the climate in any detectable manner, and hence, to offer only equally undetectable environmental, health or safety benefits.
The Conference Board report, and other studies of the likely high costs and non-existent climate benefits of the pending cap on oil and gas emissions, would offer cover for the prime minister if he backed away from what’s clearly an ill-considered climate policy poised to wreak massive economic harms to Canada, particularly in the West. Apparently, however, he’s unwilling to acknowledge reality and change course.
Author:
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