Can We Really Become ‘Energy Independent?’
I watched about 15 minutes of Trump’s speech in South Carolina last night, and if he runs in 2024, the Democrats could nominate Mickey Mouse, Donald Duck or Smokey the Bear and they would win.
I’ve said it before but it’s worth saying again. Trump is being investigated for all sorts of things, but the only crime he has committed is the one crime that no politician should ever commit — he’s become a bore.
Does he really think that in 2024 anyone’s going to care about finishing the Mexican wall? Does he really believe that global warming is a hoax when GM and Ford will be making nothing but electric cars?
Trump’s quickly becoming a parody of himself, and he can’t even get that social media app to work.
Meanwhile, Joe has his own problem right now which is the fact that yesterday I paid $4.29 for a gallon of gas.
What was I paying a couple of weeks ago? $3.29? Or maybe it was $2.89. It sure as hell wasn’t more or less the same price as a case of Lite beer.
Which is how the average American thinks about inflation — the cost of gasoline and the cost of beer.
All this talk about how gasoline is a ‘global’ commodity and how we still aren’t ‘energy independent’ is a load of crap. We don’t need to worry about gasoline for the simple reason that as we replace all our cars and our trucks with new models over the next five years, the amount of gasoline consumed by the American car fleet will drop by at least 10% every year.
Later this year Ford is going to start delivering an all-electric F-150 truck to dealers. The F-150 happens to be the most popular vehicle manufactured by Ford. And yesterday I saw an ad for a new Toyota Prius which gets 56mpg. A car which gets 56mpg today is costing its owner the same per-mile price which his current car would cost if a gallon of gasoline went back down to $2.25.
Now let’s get back to the whole bugaboo about energy ‘independence,’ okay?
Right now, the U.S. is importing the same amount of crude oil that we imported in 1990. We reached the highest annual import number in 2004, and crude imports have been dropping every year ever since that date. In 2021, we imported 2.23 billion barrels of crude.
In 2020, American vehicles consumed 123 billion gallons of gasoline, or roughly 337 million gallons every day. How much of this supply was imported? Somewhere around one-third of the total gasoline that we consume.
But and this is a very, very important but, we export more than one-quarter of all the crude produced in the United States. In other words, the price that American drivers are paying for fuel at the pump is not just a function of domestic supply and demand. It’s also dependent on how much domestic producers can get if they ship American crude overseas.
If American energy producers were prohibited from selling what they pull out of the ground to any customer who wasn’t located within the United States, between such a law and the continued shift to electric cars, we would shortly be energy independent. If not, not.
Except the problem is that when it comes to shifting away from gasoline-powered vehicles to plug-ins, we happen to be buying about half as many electric cars as China buys every year, and for every electric that American consumers buy, customers in China buy — ready? — five! In other words, not only do American energy companies sell what they produce overseas, but American car manufacturers also sell much of what they make overseas.
It’s all fine and well to talk about ‘energy independence,’ but that’s not the whole story by any means. And if we realty want to have an energy industry that isn’t dependent on what happens beyond our shores, we might consider doing what the Amish do to get from place to place.