"Drill, baby, drill": The American fossil fuel surge could risk a downturn in Europe...
Both Trump and Biden are advocating for profitable U.S. fossil fuel agreements—a gamble considering the EU's intention to reduce its reliance on such energy sources. (1) "The Dark Day: Europe's Energy Crisis Revealed" suggests history may repeat itself, marking a dire moment for the energy sector of the aging, vulnerable continent. "The Delicate Balancing Act of Political Reckoning" refers to the unpredictable outcomes of sensitive political issues. In politics, certain topics are so delicate that they can cause upheaval within the social and political structure of a country.
(1) https://www.germantoroghio.com/blog-1-2/wltpflwya644ltd-9xgre-f9l3k-74tkd-tn6zx-w7shk-fbxaj-6sytt-9lekr-dk72t-krxf3-tm445-b7hj8-p962c-5z4l3-nntza-dywdz-xhf24-dxjl5-h6lly-jx95h-dalp4-6zlrk-fmre6-7zbng
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Woody Guthrie's "This Land Is Your Land" celebrates America's beauty and diversity despite the country's actual reality…
Far away, to be a surprise...
The attempt at former President Donald Trump's life in Pennsylvania last Saturday is indeed a stark reminder of the ongoing violence in the United States. The country has a long history of attacks on both prominent figures and innocent civilians in various public places like schools, nightclubs, and shopping centers. These tragic events continue to highlight the deep divisions within the nation, casting a somber shadow over its landscape. Woody Guthrie's "This Land Is Your Land" paints a picture of America's beauty and diversity, but it can feel like an idealized vision compared to the current reality. The contrast between the song's hopeful message and the persistent violence is indeed striking.
Last Saturday, our discussion centered on Hemingway's portrayal of aging as an unavoidable passage, a theme that recurs in his literature, in relation to the health status of President Joe Biden. The metaphor of the brain turning from blue to grey in the twilight of life to reflect weariness and fatigue is quite poignant. The fear of vulnerability and isolation is amplified by age, making decisions incredibly challenging, that’s life. In "The Old Man and the Sea," published in 1952 and awarded the 1953 Pulitzer Prize, Hemingway depicts a lonely, aged fisherman grappling with the vast ocean.This conflict is bound to escalate into a perilous situation when it moves into the volatile environment of the "Situation Room" in one of the world's most influential nations.
In summary, the text discusses the challenges of influencing the internal dynamics of individual nations while recognizing the interconnectedness of the global community. The fall of the Berlin Wall in 1989 symbolized the end of the Cold War, a period marked by tension and conflict. While some saw the event as a “positive” development that allowed for the sharing of wealth with previously oppressed populations, others noted that it also led to new divisions based on ideologies and power struggles. Additionally, religion has emerged as a significant factor in contemporary global conflicts. It is indeed a bit disheartening to think that the ideals expressed in "This Land Is Your Land" might not fully align with today's reality.
As I conclude the analysis, a notification pops up on my computer screen, announcing the regrettable yet anticipated assassination attempt of former President Donald Trump. The nominee of the Republican Party has become even stronger following recent events, while President Joe Biden, recovering from a bout of COVID, appears increasingly vulnerable. Despite this, and the persistence often associated with age, he has not shown any intention of stepping down. Today, the New Yorker released an article stating, "Doctors Are Increasingly Worried About Biden," where nine physicians expressed concerns that President Biden's symptoms may surpass a typical age-related decline. Concurrently, another article emphasized, "The Presidential Race Is in Uncharted Territory, but It’s Clear Who’s Winning." CNN's Harry Enten suggested that Donald Trump is likely to win unless there are significant changes in the race, while pollster Ann Selzer discussed the methodology behind polling knowledge. Now, the million-dollar question is: what will happen with Ukraine and Europe?
The history of Ukraine represents a multifaceted process of disengagement from Russia…
The world is currently facing one of the most severe war scenarios since the end of World War II. Ukraine's current boundaries and identity have been shaped by centuries of conflict and cultural exchange. The roots of this relationship trace back to the Kyivan Rus, a medieval state that is considered the cultural and historical foundation for both Ukraine and Russia. Over the centuries, Ukraine has been divided and ruled by various powers, including the Russian Empire and the Soviet Union. Ukraine's history is indeed complex and deeply intertwined with Russia. The region has seen periods of independence and foreign domination, particularly by Russia. So, the strategic significance of the conflict in Ukraine is immense, and neither Russia nor Ukraine is likely to achieve a decisive victory, making a resolution seem unattainable. Understanding the Jewish roots in both Russia and Ukraine is crucial, as these communities have deep historical ties dating back over a thousand years. Jewish communities have existed in Ukraine since the time of the Kievan Rus' and have contributed significantly to cultural and religious movements such as Hasidism and Zionism. Similarly, Jewish communities in Russia have a long and complex history, marked by periods of both flourishing and persecution. During the 1970s and 1980s, the Russian Jewish community was the only minority group in the Soviet Union allowed to emigrate to Israel or, in some cases, the United States. This unique opportunity was influenced by several factors, including political and social considerations, the community's economic influence in the black market, international pressures, and changes in the Soviet Union's stance on Jewish emigration.
Israel has maintained a neutral stance in the Russia-Ukraine conflict, while Russia has also taken a neutral position in the Israel-Palestine conflict. This mutual neutrality helps both countries navigate their complex international relationships. On the other hand, the Russian Orthodox Church has played a significant role in supporting the Kremlin during the conflict with Ukraine. Led by Patriarch Kirill, the Church has provided moral and ideological backing for the war, framing it as a defense of the "Russian World" and aligning closely with the Kremlin's narratives. This support has been evident in sermons and public statements that justify the conflict and promote a unified Russian identity.
(2) In 1979, Andrei Tarkovsky, one of the few Russian intellectuals granted exile by the Communist regime, released his film Stalker, which was filmed in the post-industrial wasteland of *Estonia. The film seems to eerily predict the Chernobyl nuclear disaster of 1986, which led to the formation of an exclusion zone around Pripyat, Ukraine. The Chernobyl disaster had profound social and environmental impacts. The explosion released large amounts of radioactive material, leading to long-term health issues, environmental contamination not only in Ukraine but also in much of Europe, and the displacement of thousands of people.
The ongoing conflict with Russian-backed separatists in the Donbas region continues to shape Ukraine's political landscape. This prolonged struggle has caused significant economic damage, social disruption, and environmental harm, deeply affecting the country's political and religious leadership.
Concerns about a scenario similar to the Yalta Conference of February 4-11, 1945, where the leaders of the US, UK, and Soviet Union discussed the postwar reorganization of Germany and Europe, facilitating the end of the current conflict between Russia and Ukraine, are unfounded. The objective answer is no, primarily due to China's significant influence in the new geopolitical order. Many countries in the region fear a potential repetition of history with a "second Yalta," where the *US and Russia make deals supposedly at their expense.
The phrase "This land is your land, this land is my land" from Woody Guthrie's song emphasizes the idea of collective ownership and inclusivity, celebrating the beauty and shared responsibility of the land. However, this sense of unity and belonging is starkly contrasted by the ongoing conflict between Russia and Ukraine, where territorial disputes and geopolitical tensions have led to significant strife and division.
(2) https://energycentral.com/c/og/tarkovsky-1986
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TU.S. companies are already planning a pivot away from Europe. Image: Germán & Co via Shutterstock‘Drill, baby, drill’: America’s fossil fuel boom risks bust in Europe
Both Trump and Biden are pushing lucrative U.S. fossil fuel deals — a risky bet given the EU’s plans to wean itself off the energy source.
The article "‘Drill, baby, drill’: America’s fossil fuel boom risks bust in Europe" by Gabriel Gavin and Ben Lefebvre, published on July 19, 2024, discusses the potential consequences of the United States' fossil fuel deals in Europe, especially in light of the EU's plans to reduce reliance on this energy source.From Texas to Pennsylvania, there's something more valuable than gold under the ground — and climate-anxious Democrats are too afraid to touch it.
So goes Donald Trump's typically hyperbolic argument on new oil and gas ventures, which Republicans trumpeted this week as they formally tapped the ex-president as their 2024 White House candidate.
In a speech at the Republican National Convention Thursday, Trump blasted the "green new scam" and doubled down on plans to boost fossil fuel production.
There's a major problem, though: The vast fossil fuel reserves aren’t the energy El Dorado the Republican contender's economic plans depend on. Even under Joe Biden, America may have already overcommitted.
Just a year ago, it didn’t necessarily seem that way. The U.S. had been handed a major new market in Europe as it swapped Russian gas for American supplies. Some Europeans even began worrying they were trading an over-reliance on Russia for over-reliance on America, with costly implications.
Now, though, Europe is preparing to kick its gas habit altogether as it seeks to slash planet-warming emissions. Gas demand is dropping, companies aren’t signing long-term gas contracts and renewable energy is growing. Meanwhile, politicians are increasingly pushing to be in control of their own energy supplies.
Still, Trump is bellowing “drill, baby, drill" on the campaign trail and the sentiment was front and center at this week’s Republican National Convention, where the party’s platform promises to “unleash Energy Production.”
"The biggest producers are states like Texas, Pennsylvania and Louisiana — and at least some of them are important swing states," said Kunro Irié, a visiting fellow at the Center for Strategic and International Studies in Washington.
Trump's plan centers on a bet that the U.S. can cash in on foreign demand if it rips up green legislation, massively expands offshore drilling and ends a Joe Biden-imposed moratorium on new liquid natural gas (LNG) export permits.
Even if Biden wins and maintains the moratorium, U.S. oil and gas production has already reached all-time highs and is hiring 10 percent more staff. And in the coming years, LNG exports will still spike, even if no new permits are awarded.
But a cliff edge may be looming.
Turning green
Russia's move to slash gas supplies to Europe after its invasion of Ukraine didn't just spark a frantic search for alternative providers. It also forced the European Union to drastically drive down its fuel use. Since 2022, the bloc has slashed demand by 18-20 percent each year.
Some countries, such as Finland, Denmark and Lithuania, have virtually halved their demand, meaning they need far less gas than at any time in recent history, according to a report from the Institute for Energy Economics and Financial Analysis. And despite funding challenges and uneven implementation, the bloc has seen renewable power skyrocket as part of a plan to be carbon neutral by 2050.
"We expect that demand for natural gas is going to continue declining at pace," said Georg Zachmann, a senior fellow at economics think tank Bruegel. "Given we have these climate commitments, the expectation is that demand will be lower by 2030, even lower by 2040, with the effect that there is no long-term gas demand in Europe."
Several EU countries have ambitions to phase out fossil gas over the next decade, ahead of a 2050 climate neutrality target.
Buyer's market
Pledging Europe will take "its energy destiny back into its own hands," European Commission President Ursula von der Leyen in April said that despite the shrinking demand, officials were still trying to negotiate the best deals in the meantime.
"A large wave of new LNG export projects are coming to market in the second half of the decade, mostly from the U.S. and from Qatar," she said. "These projects are going to increase the global supply of LNG by 50 percent. As a result, we're moving from a world of shortfalls of gas to the opposite, a world where we could soon see an abundance. This could bring significantly lower gas prices."
That rise in capacity could spell trouble for those looking to sell gas to a shrinking pool of interested European customers. For years, American analysts have questioned why the EU was refusing to strike long-term contracts with U.S. suppliers to replace lost Russian supplies. Now, it looks like that might have been a prudent move.
"I don't think it's a coincidence they haven't struck these contracts at all," said Tom Marzec-Manser, a gas markets expert at commodities giant ICIS, arguing the Europeans may well be betting on prices continuing to come down and demand continuing to shrink. "Without a doubt, Europe won’t be the biggest customer for LNG over a 15-20 year period."
According to Marzec-Manser, Trump ending the Biden administration's LNG export permitting pause would mean little because "these projects won't come online for years and their gas almost certainly won't ever end up in Europe."
Go East
While Democrats and Republicans fight over whether the fossil fuel industry should continue to expand, U.S. companies are already planning a pivot away from Europe.
Cheniere was the leading American supplier of LNG to Europe in 2022 and 2023. Its executive vice president and chief commercial officer, Anatol Feygin, told POLITICO that the rise in sales across the Atlantic was "not master puppeteered by the U.S government or Cheniere. It is the invisible hand of the market that sends the price signal."
According to him, "We have about three dozen long-term customers. Roughly half are entities that are based in Europe. But very few of those are in essence wired to go from Point A to Point B."
Now, he said, "Asia is going to be the driver of gas and LNG demand," not Europe.
That flexibility has until now actually played in America's favor, according to Michael Lewis, CEO of Uniper, Germany's largest gas importer.
"When it comes to LNG supplies, Germany has limited options. This is because most of the exporting countries only want to sign long-term contracts for about 15 or 20 years. This does not fit with the German strategy of decarbonization,” he said. "The U.S.A. are among the very few suppliers ready to sell on a mid-term basis, as well."
That may have given U.S. firms a lion's share of the market, but it's a market that could disappear very quickly, leaving American firms with a hole to plug in their budgets. While extra American production will be helpful if Europe has unexpected power demands or an extremely cold winter, said Jason Bordoff, founding director of the Center on Global Energy Policy at Columbia University, the direction of travel is away from the West and toward the East.
"As renewables grow and maybe as Europe starts to find alternative sources of energy, you can see more of those supplies, say, going to Asia." But, with shipping costs making up a large share of the overall price of LNG, it remains to be seen whether the U.S. can pivot its logistics from East to West while maintaining competitiveness.
Europe's Rust Belt
One downside accompanying Europe's gas demand reduction, and the associated price rises, has been a dramatic downturn for energy-intensive industries.
According to a report from Bordoff's Center on Global Energy Policy in March, the EU's gas demand "declined by about 11 percentage points between January and December 2022, and remained depressed throughout 2023, ending the year approximately 13 percentage points below January 2022 levels."
The worst affected have been sectors like manufacturing and chemicals, which have seen production decreases and layoffs.
David Goldwyn, a former official in the State Department and Energy Department during Barack Obama's presidency and chairman of the Atlantic Council Global Energy Center’s Energy Advisory Group, said the picture could change.
"There is a lot of upside for industrial revival in Europe, which would be more gas," he said.
However, according to Zachmann, the European energy analyst, the decision lies not with Trump and Biden, but in what kind of Europe will emerge from the energy crisis.
"Lots of heavy industries have had a hard time in recent years,” Zachmann said. “But, there is growing pressure to create skilled service jobs in their place. Ultimately, if Europe doesn't produce that much natural gas of its own, and has to bring it in from across the Atlantic, there may come a point that it doesn't feel very wise to set up gas-intensive industries like fertilizer manufacturing here anyway."
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