Friday in Washington D.C., two distinct worldviews competed. At 1600 Pennsylvania Avenue, President Trump met with executives from seven oil companies, including some of the largest in America, to discuss how a global glut and plummeting demand during this pandemic have driven down petroleum prices. At the Capitol building, in unheralded meetings, House Democrats and environmental lobbyists discussed the party’s Moving Forward Framework. That’s the draft for a $760 billion House bill on infrastructure. It includes $329 billion for highways and $34 billion for “clean energy.” The dueling meetings embodied the battle between fossil fuels and clean renewable energy.
The North America director of the environmental activist group 350.org, Tamara Toles O’Laughlin, issued the following statement regarding Trump's oil meeting:
The President of the United States should be meeting with the 10 million Americans who have filed for unemployment due to the pandemic. He should be reaching out to the nurses and doctors who are non stop caring for sick patients, without enough protective gear or equipment. It’s disrespectful that instead he’s chosen to roll out the red carpet for Big Oil executives. It’s shameless!
Some analysts have said Trump could invoke the Defense Production Act to purchase oil to fill the country’s Strategic Petroleum Reserve (SPR). Using this executive power, he could potentially bypass Congress and the environmentalists, like 350.org, that stopped the bailout of oil and gas companies in the $2.2 trillion coronavirus stimulus bill.
On Thursday, Trump made the still unsubstantiated claim that he had convinced Saudi Arabia and Russia to reduce oil production, which raised oil prices. The two countries have increased production, leaving the world with an oversupply. Saudi Arabia alone was processing a record 12 million barrels a day. With the worldwide economic slowdown due to the coronavirus pandemic, the oversupply and low demand reduced the price of WTI Crude oil to just over $20 this week compared to $40 a month ago. After Trump’s tweet, the price of WTI Crude spiked before settling to $25.
Tyson Slocum, the Energy Program director for the advocacy group Public Citizen, told The Young Turks in an email that, in 2012, President Obama invoked the Defense Production Act to help out the biofuels industry. Regarding the possibility of using the DPA to bail out fossil fuels by filling the SPR, Slocum noted that the Department of Energy (DOE) had filed a solicitation about using the SPR to store oil. Slocum wrote,
…this appears to be more of an opportunity for US producers and various marketers to use the SPR as a short-term storage option. That’s because right now, private storage facilities are actually filling up fast, since the demand shock means a lot of oil has nowhere to go. I’ve heard that some pipeline companies are considering using their pipelines to store oil, as the situation is getting bad.
Slocum also noted that the 2015 budget bill created an energy security fund to pay for SPR maintenance. He estimated that the fund has some $850 million the DOE could use to buy oil.
On Thursday, Treasury Secretary Steven Mnuchin said that the Treasury has limited ability to aid oil companies, but will work with the Federal Reserve to lend the companies money.
The oil executives reportedly attending the president’s meeting Friday were: Exxon Mobil CEO Darren Woods, Chevron CEO Mike Wirth, Continental Resources founder Harold Hamm, Occidental Petroleum CEO Vicki Hollub, Devon Energy CEO David Hager, Phillips66 CEO Greg Garland, and Energy Transfer CEO Kelcy Warren.
There were different types of oil companies present at the meeting: Big oil and smaller companies focused on natural gas and fracking. Their interests are not the same.
The oil industry's main lobbying group, American Petroleum Institute, has said that oil companies do not want a bailout -- that the market should decide. And Big Oil executives at Friday’s meeting have not been donating significant amounts to Trump, Federal Election Commission (FEC) records show.
But others at the meeting have been. Kelcy Warren, head of Energy Transfer, last year donated $5600 to Donald Trump’s campaign, and $360,600 to the Trump Victory joint fundraising committee, according to FEC records. Warren also gave $355,000 to the Republican National Committee. Energy Transfer is a natural-gas company and owner of Sunoco. It is also part-owner of the controversial Dakota Access Pipeline.
Hamm, the founder of Continental Resources, has contributed $50,200 to the Trump Victory joint fundraising committee and the Trump campaign. Hamm has called for tariffs on foreign oil. He is invested in shale oil, which requires fracking to remove the oil and gas from shale rocks.
Fracking is not only worse for the environment and climate change, it’s more expensive. Fracking companies have to sell at higher prices to make a profit. The shale oil industry was profitable when the price of oil was $60 a barrel. It is not at $25. Analysts have said big oil companies may be able to weather this economic downturn, but that smaller oil companies may get absorbed or die.
As the White House meeting occurred, over at the Capitol -- and via videoconferencing -- sources say, major environmental groups including the Sierra Club, Oil Change International, 350.org, Greenpeace, and the Sunrise Movement met and communicated with Democratic congressional staff from both the House and Senate to work on the Moving Forward Framework infrastructure plan. They hope the plan will lead to a House bill which includes environmentally sustainable industries. House Democrats believe their plan could mean 10 million jobs and a major shift in American energy policies and pollution.
However, on Friday, House Speaker Nancy Pelosi backtracked, saying the next stimulus relief bill would have to be like the last one, giving direct aid to deal with the pandemic. She said it was still possible Democrats would pursue infrastructure and environmental changes in another stimulus bill.
On Wednesday she had noted that the $760 billion plan includes money for community health centers to combat the coronavirus, highway improvement, public transit, railroads, airports, clean water and wastewater treatment, harbor infrastructure, clean energy, broadband for the entire country, and public safety.
Natalie Mebane is the associate director of policy and a lobbyist for 350.org. She told TYT that environmental groups coalesced last month to stop the oil industry bailout because of the speed at which the coronavirus stimulus bill went through the Senate. She told TYT, “…with the Senate package moving so quickly and being so large… we just had to coordinate faster than ever, we had to work together and move as a community and think faster than ever…. We all work together, we all coordinate, we all share, because we’re all fighting for the same things.”
Mebane noted that the key issues for the next stimulus plan would be supporting clean energy, reducing carbon output, and green jobs.
…If we are doing the right investments with clean energy, and also making sure that we are actually trying to reduce our carbon pollution, because that is the most critical… this is the only time we have… and also providing the job transitions. I think we don't want to sideline and hurt workers who are stuck in the fossil fuel economy by no fault of their own. They're trying to work, they’re trying to live.
Whether a Democratic House bill could pass the Senate or get a presidential signature remains to be seen. Trump is unpredictable, though his record has been consistently anti-environment. Because Senate Majority Leader Mitch McConnell (R-KY) is in a tight reelection race, some activists believe he may be more accommodating on environmental issues.