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Opinion
Blood and oil
Friday, March 18, 2022
Now entering its fourth week, the War in Ukraine has officially surpassed the collective attention span of the American Public, and the partisan bickering is back in full stride. On the left, blame for the war falls equally between Donald Trump and Tucker Carlson. The tele-wag Carlson made a few uncomfortably pragmatic observations about the situation, making him the biggest voice for conservative isolationism since Charles Lindburgh. Carlson suggested that Ukrainian capitulation on a few, select issues would make little difference in the daily lives of Ukrainians but would, for now, stop the bloodshed. I don’t agree with him, but I give him credit for playing the role of devil’s advocate.
As for Trump, he’s just being Trump and the hard left is still working the old playbook. Trump fails to choose his words carefully and the press pounces. It’s a tried, tested, symbiotic relationship. We have seen it before and I find it tiring.
The right, naturally, holds the Biden Administration responsible for the war and cites the Afghanistan pull-out and other dovish tendencies as contributing factors. Concurrent with ongoing and potential military conflicts are calamitous inflation, an energy crisis and the remnants of the Covid epidemic.
The administration has much to keep it busy, and there is much to be criticized, but the common denominator between armed conflict and inflation is clearly oil. Mr. Biden did himself no favors when he took two, largely symbolic actions regarding oil pipelines on the first day of his administration. At the time it looked like revenge. It looked petty. He was spiking the ball after an election, but in hindsight, many would contend that those actions set the stage for our current situations in both energy and foreign conflict.
Mr. Biden’s defenders will correctly point out that the oil cost equation is a black box with multiple, murky inputs ranging from the actions of foreign cartels to local regulations. To lay 100% of the blame with Mr. Biden is as incorrect as it is to absolve him. It’s complicated.
The subject of oil has tied our domestic economy to middle eastern conflicts for most of my lifetime, and for those in the generation before me, many blame our oil embargo against Japan for the attack at Pearl Harbor. President Roosevelt cut off the supply of oil to Japan five months earlier in response to Japan’s invasion of French Indochina (now Vietnam). Britain and the Dutch East Indies followed suit and overall, it’s estimated that Japan lost access to 88% of its oil supply. Japan saw that as sufficient motivation to “wake the sleeping giant,” and we all know how that turned out. I find that five-month time frame between sanction and an act of desperation to be informative as we wait for current sanctions against Russia to affect policy.
As consumers, we experience the scarcity of oil at the gas pump, but much of that price is driven by the market value of crude oil. At the end of January 2021, Brent Crude sold at $53.60 per barrel. As of this writing, the Brent Crude spot price sits just north of $106 for the same barrel of oil. The oil is the same. It’s a commodity, but the price has doubled. During that same time frame, the American Automobile Association gas cost average has risen from $3.32 to $4.29. That’s only a 30% increase and locally, the price is currently just under four dollars, so there’s more pain in our future.
Filling our consumer gas tanks is very likely our most immediate contact with the situation, but the power and heating we use in our homes are also impacted. Oil is refined into kerosene, diesel and jet fuel as well, so all shipping and travel are impacted, as well as generators, farm machinery, and other non-transportation industrial machinery. Crude oil is also processed into asphalt, lubricants and waxes. Increased costs of those outputs are being felt as well.
The subject of rising oil prices raises all of those issues in the minds of most Americans and is reflected accordingly in news coverage. What we forget is that nearly ten percent of our total oil supply is used in the production of plastics.
Just take a quick look around wherever you happen to be. Take note of all the plastics in our lives. Think about the plastics in your kitchen, your garage, your office, your toothbrush and the dashboard and tires on your car. How are your groceries packaged?
The list of common household products produced with petroleum-based plastics and rubber is endless, but it’s used in our foods as preservatives and food coloring too. That orange powder on your Doritos? That’s a petroleum product.
The wax in my chocolate bar is made from petroleum, which raises a linguistic curiosity. In British English, another name for kerosene lamp fuel is paraffin. I have always known paraffin as those semi-opaque blocks of wax used in home canning. As it turns out, that’s no accident. It’s the same stuff in different form.
And textiles? We all know that 1970s fashion couldn’t have been possible without petroleum-based polyester, but plastics find their way into most manmade textiles these days. If the label includes acrylic, nylon, spandex or acetate, that’s oil too. Even if you stick to cotton and wool, think of your buttons, zippers and other structural components.
It’s hard to look at all of the ancillary uses for petroleum products without thinking of the noble, but misguided proponents of conservation and the “Green New Deal.” I like clean air and water as much as anyone. I’m guessing you do too. I have always supported the “All of the Above” approach to a gradual, practical transformation to cleaner energies, but the influence of the “Green New Deal” proponents is literally pulling the rug out from under us. Yes, the carpet you stand on is made of petroleum-based plastics too.
For a more comprehensive list of uses for oil, consider visiting The U.S. Energy Information Administration web site at www.eia.gov.