Breaking Down Where We Can Get Oil

CLAY: There is a solution out there of sorts and, by the way, it’s produce more gas in the United States. Drill, baby, drill. But in the short term what we are doing, Buck, is we are paying for Ukraine to fight against Russia, billions of dollars, and we are simultaneously putting billions of dollars into the pockets of the Russian regime of Vladimir Putin because we are paying for the resistance of Ukraine while still buying — to a large extent — Russian oil.

That is true for many different Western democracies, and so there has become the discussion and the decision, how do we replace Russian oil so that we’re not effectively playing both ends of this conflict, both Ukraine and Russia? And there appear to be… You tell me if you can think of additional ones, but there appear to be five primary ways in which we could increase the amount of oil that we are able to get from supplier nations.

The best option is for the United States to go into overdrive. I would argue that there’s probably even a strong argument to be made that we should be incentivizing the oil production in the United States because we would rather incentivize U.S. corporations and U.S. dollars than we would give them to other places. So the United States to me is a clear number one. I think the clear number two — and the Biden administration, unlike the Trump administration, has tried to isolate Saudi Arabia in many ways.

Of the petrol states that can produce a ton of oil and gas, Saudi Arabia seems to be the second-best option but the Biden administration has had a poor relationship, I think it’s fair to say, with Saudi Arabia. Third best option — and it drops off significantly here to me — Venezuela. Fourth is Iran, and the fifth best option is Russia. So, we can’t do Russia.

Would you agree in general, Buck, that those are the five major options that we have? And we’re driven to a situation now because the Biden administration will not embrace the fulsome production of oil and gas in the United States such that we are going to other countries and trying to amend, repair relationships that have been poor in order to try to drive down the price of oil.

BUCK: Let’s think about the implications. Yes, the ranking of how this will go, Clay, and what states have additional capacity. Traditionally we’ve always gone to the Saudis and OPEC saying, “Please, use more of your capacity,” right? OPEC is a cartel. We all know it. So they can control the price, but we also sometimes ask them to do some things to help bring the price down. Venezuela was producing at its height, I think it was… Well, it’s essentially producing 10% now.

I think it was about three or four million dollars a day back in the nineties and now it’s between three and four hundred thousand barrels a day, something like that. So Venezuelan production is down substantially and there are sanctions on Venezuela because it’s a… Well, it’s actually not even just a petrostate. It’s a narco state if you look at the Treasury sanctions against senior Venezuelan officials for drug trafficking. It’s a socialist hellhole as we all know, but now we’re in a situation where we’re gonna turn to them, perhaps, or even Iran.

CLAY: The president, by the way, Maduro, we’ve tried to argue he’s not the legitimate president for years, and now we’re showing up in Venezuela and we’re like, “Hey, oh, by the way, hey, Maduro? Yeah, sorry about that whole you didn’t deserve to be president thing. We need your gas,” right? Like, that’s where we are with Venezuela, which is a mess in and of itself.

BUCK: Here we go. Here’s Pete Buttigieg last week when he’s asked specifically about Iranian oil, which might even get people’s attention more than oil coming, you know, asking for a change in the sanctions regime of Venezuela so we can start buying Venezuelan crude. Here’s what the transportation secretary said.

REPORTER: Could the president possibly consider authorizing the Keystone pipeline, working something out with Iran?

BUTTIGIEG: Look, the president has said that all options are on the table, but we also need to make sure that, uh, we’re not galloping (sputters) after permanent solutions to immediate short-term problems where, uh, more strategic and tactical actions in the short term can make a difference like what you have with the strategic reserve which exists partly in order to respond to situations like this.

BUCK: So we have him not saying “no” because they are thinking perhaps about this as a possibility because, mind you, Clay, while all this is going on, the Obama administration is trying to push for a new Iran nuclear deal, ’cause the Obama Iran nuclear deal was so great, they’re gonna do a deal that gives Iran even more of what it wants. Meantime this actually broke on the Washington Examiner website, WashingtonExaminer.com.

“At least two Iranians belonging to the Islamic Revolutionary Guards’ covert-action Quds Force have been plotting to assassinate former national security adviser John Bolton, according to a Justice Department official with direct knowledge of the investigation. The source tells the Washington Examiner that the department possesses indictable evidence against the Iranians but that Biden administration officials are resisting publicly indicting the men for fear that it could derail their drive for a nuclear deal with Iran, currently nearing completion in negotiations in Vienna, Austria.” So just to give everyone a full sense, you’ve got that story breaking in the Washington Examiner, to give everyone —

CLAY: Does John Bolton even have security? I mean, I’m like, if I’m John Bolton, I’m like, “Iran’s trying to kill me?” It’s not like he has Secret Service protection. I mean, that’s not a guy… You talk about assassinating any American former official that is obviously should be, I think, a red line. We were just talking about this last week when Lindsey Graham said somebody needs to kill Vladimir Putin.

And we actually said, what if our adversaries were trying to kill government officials of America? The fact that they’re trying to cover this up is not good. But John Bolton I wouldn’t think would have even that much security around him, which is alarming, too, meaning it could be somewhat successful. It’s not like he’s followed by a cadre of Secret Service agents.

BUCK: And yet just goes to show you this whole situation, the Biden view, the Democrat view…. “Biden view.” Biden doesn’t know where he is sometimes. The Democrat administration, the Democrat general view on all this stuff is somehow more oil from America, bad.

CLAY: Yes.

BUCK: More oil from Venezuela, Iran, wherever right now, good. Because our oil, there’s something wrong with it? There’s the same carbon emission, folks, same stuff going into the air which is not a problem anyway but put that aside for a second, same CO2 emissions, but they would just rather us not — ’cause we have to lead on climate change, Clay. I want everyone to remember that when they’re filling their tank with $5, $5.50, $6-a-gallon gasoline. Oh, it’s for leading on climate change.

CLAY: And let’s not understate what’s happening here. We are taking American dollars, and we are giving them to authoritarian petro-state people, by and large, who hate America. So we are enabling them to be more effective in their governance because they have more money to distribute, and it is American dollars that are being distributed.

And this is infuriating, I know, to many of you because we should have created an opportunity for ourselves to be producing the full amount that we possibly can in the United States, but as you point out, Buck, this is where Democrats have played themselves, right? They’ve painted themselves into a corner where in order to continue to make their climate change lunatics happy, they have to now give money to Venezuela, Iran, Russia. Saudi Arabia is the best of the bad options.

But over their relationship with MBS, Mohammed bin Salman, I believe, relating the killing of the Washington Post journalist, they basically have isolated Saudi Arabia so Saudi Arabia has not been inclined. Even though Saudi Arabia’s traditionally had decent relationships of all of these countries that we’re talking about, with the United States.

They haven’t been inclined to increase production at all. So as oil skyrockets to $130, as people are paying closer and closer to $5 a gallon for gas everywhere, that money is going directly into America’s enemies pockets because we’re making the conscious decision not to produce as much as possible in the United States.

BUCK: And this all comes from a belief — just remember this — that the Green New Deal is not insane, that the world is going to end unless we have a massive reduction not just in carbon emissions but in modern lifestyles, folks. The amount of wealth destruction that it would entail to actually meet the target that we’re never going to meet but they’re gonna whine about it anyway.

What, because Greta Thunberg said, “How dare you?” we’re all supposed to change how trillions of dollars of economic activity occur? This is completely insane, it’s absolutely absurd, but the Biden base won’t allow him to go back on this. I mean, here’s even Chris Christie, who’s saying that, straight up, that domestic Democrat politics are what’s making this energy issue so incoherent.

CHRISTIE: Gotta do two things at the same time, and you should be able to. You have to ban Russian oil, and you have to increase domestic production. And that is where Joe Biden’s gonna have the problem, because he’s held captive by the environmental left (crosstalk chatter), which John Kerry, his guy, said last week that the real tragedy of Ukraine is it’s slowing our efforts on climate change. This program summarize what the far left’s view is about domestic oil production.

BUCK: He’s right, Clay. These people are hardliners. They’re like climate Bolsheviks. They’re not a majority, not even close. They’re maybe 5 to 10% of the country, but they’re incredibly loud, they’re well-funded, and they’re very influential. And they’re absolutely nuts.

CLAY: Well, what this shows us, too — and we probably should continue to talk about this during the course of the show — is so much of what we are concerned about in the United States on a day-to-day basis really doesn’t matter. When you look at what’s going on in Ukraine, when you look at the threats of Russia, we get obsessed with things that aren’t actually helpful in any way.

And one of these is the idea of a hoped-for future where fossil fuels have a smaller and smaller role in the world versus a reality right now where every single person who’s filling up their car or truck or SUV is paying a default massive tax increase because of our American energy policy which is broken right now.

BREAK TRANSCRIPT

BUCK: Banning oil imports. U.S. and NATO banning Russian oil imports. This will be… Understand first off, is it oil and gas or is it just oil? That actually makes a difference. The European states, notably Germany, gets I think 10% of its oil from Russia, but something like 30 to 40% of its natural gas from Russia. So the devil is in the details as always. But, Clay, I think we could be in a remarkable situation in a sense here because they’re talking about doing this.

If they pull the trigger on that, so to speak, if they actually sanction the Russian energy sector, what we’re talking about here with almost all-time record…. Now, I know it’s not a… I don’t think that’s adjusted for inflation, but still, the fact that we’re at an all-time, near an all-time high for national-level gas prices is pretty remarkable for this moment. But here they are saying they might actually take the next step of sanctioning the Russian energy sector.

And if they go after banks that do business with the Russian energy sector, that’s the real nuclear option, so to speak. The economy is gonna get really ugly in this country. I think it makes us sit around and ask this question: Is that something the American people really want? Are they willing…? Do the American people want those who represent them in government right now to drive the price of oil up to $180, $200, whatever, who knows, $200-plus a barrel?

CLAY: This is the question we asked that I thought of any so fascinating in general. What is the amount where Americans are willing to pay in order to fight effectively an economic war in Ukraine? Remember Joe Manchin came out, senator from West Virginia, and said, “Oh, I’m willing to pay an extra dime in order to be able to help Ukraine.” Well, according to the GasBuddy website, last week’s rise in gas prices was the second largest weekly jump ever.

They rose nearly 41¢ across the nation in the last seven days. The only time that it has been a more rapid increase in a week, 49¢ per gallon increase — and some of you will remember this. That happened back when Hurricane Katrina in 2005 shut down oil production in the Gulf of Mexico. So what we have seen in the last seven days, it’s not your imagination. It is one of the largest increases in gas prices in a week that has ever occurred in the history of the United States, 41¢, only went higher 49¢.