President Biden banned all US imports of Russian oil by executive order Mar. 8 as part of a bipartisan and multinational effort to make Russia pay a price for its invasion of Ukraine.
“That means Russian oil will no longer be acceptable at US ports, and the American people will deal another powerful blow to Putin’s war machine,” Biden said at a White House press conference. “We will not be part of subsidizing Putin’s war.”
Biden warned that “there will be costs as well here in the United States,” a reference to inflation worries. He said US gasoline prices have risen 75 cents/gal since the Russian military buildup began on Ukraine’s border.
He also warned against profiteering or price gouging, then he said he wanted to acknowledge that oil and gas companies have been announcing plans to pull out of Russia, as have other companies.
The executive order bans imports of Russian crude oil, petroleum products, liquefied natural gas (LNG), and coal. The US does not currently import Russian LNG, but last year the US imported 672,000 b/d of total petroleum from Russia and some coal.
The order also bans new US investment in Russia’s energy sector, and it prohibits Americans from financing or enabling foreign companies that invest in Russian energy.
Plans, problems for Europe
The European Commission, the administrative arm of the European Union (EU), on the same day proposed that EU nations adopt a series of steps to make its nations independent of Russian natural gas, oil, and coal “well before 2030.”
The commission released a plan that would aim first of all to diversify gas supplies via pipelines and LNG and could cut EU imports of gas from Russia by two-thirds before yearend.
European allies and many other friendly countries are not in a position to abruptly cut off Russian energy imports, Biden noted, “but we’re working closely with Europe and our partners to develop a long-term strategy to reduce their dependence on Russian energy as well.”
The commission said more gas supplies could be sought from “the US, Norway, Qatar, Azerbaijan, Algeria, Egypt, Korea, Japan, Nigeria, Turkey, Israel” and other countries.
The plan also proposed that Europeans seek greater volumes of renewable hydrogen production and imports, biomethane, and other renewables, and it proposed greater energy efficiency. The plan was a follow-up to proposals released by the International Energy Agency (OGJ Online, March 3, 2022).
“We must become independent from Russian oil, coal and gas,” said Commission President Ursula von der Leyen. “We simply cannot rely on a supplier who explicitly threatens us.”
US energy resources
In Congress and among US energy trade groups, there have been calls for faster processing of permit requests for LNG exports. The proposed export projects need pipeline approvals from the Federal Energy Regulatory Commission and export policy approvals from the Energy Department.
There also have been calls for the Biden administration to resume leasing oil and gas exploration tracts in the Gulf of Mexico and allow for more expeditious leasing in federal onshore areas.
Biden did not mention LNG exports but took issue with the idea that his administration was holding back US oil and gas production. Companies now have 9,000 approved permits to drill in onshore federal areas, he said.
Biden emphatically rejected the idea of loosening environmental regulations. That would not lower energy prices, he said, returning to the subject of inflation.
