The US must no longer rely on autocrats for its energy needs
The war raging in Ukraine has laid bare the West's sheer over-dependence on Russian oil and gas. Yet simply trading Russian oil for Iranian and Venezuelan oil will only result in more geopolitical issues, writes Joshua Jahani.
Vladimir Putin has many NATO nations in a vice. Indeed most European nations still remain brutally addicted to Russian energy. For US President Joe Biden, simply drilling at home would be untenable, given his green rhetoric during his election campaign.
The only way for the US (and other nations) to release itself from the bear hug and strengthen their hand at the negotiation table is to make the transition to renewable energy, and therefore detangle ourselves from the web of dependency spun by hydrocarbons.
The US has been at the forefront of the drive to cease usage of Russian oil and gas as the cost of living and pump prices continues to escalate, with Joe Biden ordered all imports to be stopped immediately following the invasion of Ukraine.
Such moves come at a heavy cost for American people and businesses. By severing the US' energy links with Russia, Biden now has to go cap in hand to the Organisation of the Petroleum Exporting Countries (OPEC) and grovel for more oil instead.
The problem, however, is that many OPEC members aren't willing to open up the taps for Biden while energy prices continue to skyrocket and their own economies struggle to recover from the lasting impact of the COVID-19 crisis. Their response to his plea was thus predictably short and sweet: if the US wants more energy it should increase its own production.
Furthermore, even if Biden was to strike a deal, his own stalling domestic energy policy has only reduced the amount of influence he can exert on OPEC. By continuing to cede control, Biden is finding himself in a dangerously untenable geo-economic position.
Even if OPEC members were to play ball, it would mean doing deals with the enemy and putting the power back into the hands of autocrats. This is exactly Biden and other western leaders have sought to avoid by shutting off Russian supplies. Becoming reliant on countries such as Iran, Saudi Arabia and Venezuela would significantly weaken the US' hand at the negotiating table.
Getting into bed with such adversaries would also leverage their position when it comes to the easing of sanctions or compromises on human rights abuses. But that would risk going against everything the West stands for.
In the US, that leaves Biden with only two viable options: to start drilling at home or to turn to renewables. The first option is a non-starter as it would represent a dramatic U-turn in policy, having already gone to great lengths to lay out his ambitious $2 trillion green investment plan aimed at tackling climate change. These include long-term plans for a clean energy grid by 2035 and massive investments in electric vehicles and infrastructure to achieve net zero by 2050.
The only way to save face and maintain geopolitical influence, not to mention the support of the Democratic party, while ensuring the US' political enemies hold as little sway over it as possible, is to turbocharge the transition to renewable energy. However, the move away from fossil fuels to renewables won't just happen overnight.
Biden needs to engage with and incentivise the private sector to drive this green revolution. The key here is to put the right investment and infrastructure in place, and establish a Sustainable Recovery Task Force of business leaders that will work alongside the US Government to advance his own agenda on climate change.
Just as the Industrial Revolution ushered in the use of coal and steam in the 18th century, we are at a critical tipping point. With the clock ticking on global warming, the move to cleaner and greener energy has never been more urgent, as flagged up by the stark findings of the Intergovernmental Panel on Climate Change's latest report.
Renewable energy has become increasingly more affordable as the cost of solar power technology has plummeted in recent years. At the same time, investment is on the rise with companies setting net zero emissions targets and being held to account over their environmental, social and corporate governance programs, and private equity backing doubling in the last 18 months alone.
If the US is to regain its position as a superpower in the face of growing Russian aggression and an increasingly hostile and divided world, it must act now to solve the energy crisis looming fast ahead. The Ukrainian conflict cannot be allowed to derail the transition to renewables. If anything, war has shown just how acute the need to detangle ourselves from the global hydrocarbon market really is.
