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WASHINGTON – U.S. Senator Kevin Cramer (R-ND) discussed the need for American energy production to combat the Biden Administration’s inflation crisis and global lower greenhouse gas emissions with Treasury Secretary Janet Yellen at a Senate Banking Committee hearing. He pointed to the Biden Administration’s energy policy and the chilling effect it is having on the markets.
“I cannot resist getting back to the issue of energy,” said Senator Cramer. “You said a couple of questions ago, that oil producers in the United States didn’t adequately anticipate the robust return to demand and, as a consequence, they did not respond by producing quickly enough. Is that basically what you said?”
“Prices were very low for a time, many energy companies suffered losses. I think they were gun shy about putting themselves in a similar position and so they cut production and investment and were probably surprised to see the rapid recovery and run up in oil prices that resulted,” responded Secretary Yellen.
Senator Cramer outlined flaws in Secretary Yellen’s assessment of energy production and multiple examples of negative signals sent to financial institutions and energy markets from the Biden Administration.
“[Energy companies] respond to chilling market signals being sent by this Administration every single day and this hearing is a pretty good example of it. When I look at [Financial Stability Oversight Council] (FSOC) action on climate related financial risks, it is one message after another: do not produce more oil in the United States of America,” said Senator Cramer. “You’ve got John Kerry running around the world saying ‘Don’t buy our [oil], buy somebody else’s.’ You’ve got the moratorium on federal drilling. Now, they’ve opened up 20% of the available drilling, but then they announced they’re not going to allow any drilling on the 20% open for easements. FSOC itself, including the [Securities and Exchange Commission], evaluating these disclosure rules, these are chilling messages. The [Federal Reserve], with its two committees to better understand climate risks and corporate commitment to supervision of financial firms. Even the Department of Defense, as we evaluate the National Defense Authorization Act, in his opening statement to the Armed Services Committee Secretary of Defense Lloyd Austin use the word climate change five times. Five times while there’s a war being fought in Europe, where energy has been weaponized. This Administration itself has helped weaponized oil.”
Senator Cramer highlighted the Trump Administration’s successful energy policies and energy dominance. He noted the link between the Biden Administration’s hostile energy policies and soaring inflation.
“[The Trump Administration] led to an economy where we became energy dominant because, not only did the previous Administration cut taxes, it cut regulations, and we became the number one producer of oil and gas in the world and our dominance at that same time, lowered greenhouse gas emissions. If the goal is better climate action, produce more [oil] in the United States. We are living at a time when our friends in Europe are pleading with us. They voluntarily cut themselves off from hostile energy production in Russia and other places. This Administration went to Venezuela for help and then they went to the [Strategic Petroleum Reserve] to your point. And now we have, not completely depleted, but less oil in this in this Strategic Petroleum Reserve at a much higher price to replenish. It’s done nothing to help inflation. It’s only helped drive up costs,” said Senator Cramer. “I’m all for aspirations and I think a 2050 fantasy is a great aspiration. But there’s a 2022 reality facing the American consumer, facing the globe, facing national security, [and facing] international security. Let’s get every regulator back in their own lane and let’s deal with the reality of 2022.”
Secretary Yellen acknowledged the need for fossil fuels and that American society cannot transition to renewables in the short term. She also perpetuated the misguided concept of climate catastrophism.
“I don’t think that anybody believes that we can switch completely to renewables in the short term. The current situation certainly emphasizes the need for energy production now from fossil fuels,” responded Secretary Yellen. “It should remind us, especially coupled with the increasingly dire predictions of scientists, that our grandchildren won’t be able to have an inhabitable planet if we don’t address the risks associated with climate change. We should not lose our focus on the need to transition as rapidly as possible to a path in which fossil fuels play a much less important role. Financial institutions themselves have recognized this. There is an alliance called GFANZ, that almost all the large American banks voluntarily signed up for, [where] they pledge voluntarily to align their own lending portfolios with a net zero by 2050 approach. So medium term – we need to move away from fossil fuels. Short term obviously we have a problem.”
Senator Cramer concluded by encouraging production of American energy to lower greenhouse gas and stimulate the economy.
“In the transition though, we ought to be producing more American fossil fuels. As we produce more American fossil fuels and sell into the global marketplace, we reduce the emissions, we create a transition that’s both useful for the investor and useful perhaps for those who are worried about climate change,” concluded Senator Cramer.
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