Remember when Biden canceled the Keystone Pipeline? Democrats praised him for his environmental actions. Meanwhile, conservatives wondered what the real reason for his actions would turn out to be.
Before we talk pipelines, I want to tell you a little story. Growing up, my love for history extrapolated into a love of politics early on. But when I heard the words “foreign policy,” I often checked out. That’s because nine-year-old me didn’t look at how foreign relations affected the state of the union. But that changed before I even graduated middle school.
Part of the reason for my expanding curiosities came from the fact that I’m a Texas girl. Obviously, my home state is rich with a unique history. And Texas is all about the oil industry. But I didn’t learn that in a book. I learned that watching Dallas while pondering who shot J.R.. As a region immersed in oil, the 1980s were hard times for the Lone Star State. In 1979, oil prices started to rise, doubling by 1980. Then disaster hit.
After the Arab oil embargo of 1973, followed by the Iranian Revolution of 1979, foreign relations definitely played a part in the crash of oil prices. As one article describes it, “the jets were grounded, cranes dismantled and commercial projects scrapped. Thousands of workers lost jobs and scores of companies went belly up.”
Houston, my hometown, was hit harder than most.
Students of history can argue about which oil bust hit Houston’s energy sector harder, but there’s little debate that the 1980s collapse did far more damage to the local economy.
The colossal fall in oil prices that began in 1982 and accelerated in 1986 not only sapped Houston’s wildcatter spirit, but undermined Houston’s economic foundations. Houston lost more than 225,000 jobs, about one in eight, and unemployment rate climbed above 9 percent – nearly double today’s rate. Office vacancies soared above 20 percent. Office rents plunged.
Loan payments to banks soon followed. Risky commercial real estate and energy loans went bad and hundreds of banks failed. Construction ground to a halt. More than 200,000 homes stood vacant.
The nation’s rig count fell from a peak of more than 4,500 in late 1981 to a low of 663 in July 1986. Sales of oil field equipment plunged from $40 billion to $9 billion over the same period, according to the Federal Reserve Bank of Dallas.
Drilling rigs were torn apart and sold for scrap, at pennies on the dollar. For people trying to figure out how much the machines were worth, the first question wasn’t “How much oil can it drill up?” It was “How much does it weigh?”
Attendance plummeted at the Offshore Technology Conference, one of the energy industry’s biggest events. More than 100,000 people had packed the trade show in 1982; two years later, organizers had the conference without an exhibition because so few people would attend. By 1987, OTC attendance reached only 25,000, just one-fourth of what it was five years earlier.
A Wall Street Journal article claimed the most exotic dish served at one Houston dinner party was a plate of cheese balls. The New York Times wrote about a Houston dentist who reported an increase in teeth-grinding problems among the locals.
In the boom years, “you got a free car and all the gas you could put in it,” said Mark Parrish, who worked for an independent oil company in the 1980s. “That was the first thing that went away. It was a pretty big hit.”
But what stands out in my own memory are bumper stickers that said ‘Please God, let there be another oil boom. I promise I won’t piss it all away this time!’
I don’t know why those stickers made such an impact on me. But they did. And lately, I find myself thinking about that sentiment a lot. Especially when it comes to the millions of people in our country who failed to see how good we had it. Which brings me back to oil.
Goodbye Pipeline, Hello War
When Biden canceled the Keystone Pipeline, he left us, once again, energy dependent. And while we were forced to buy oil from other countries, American lobbyists and even a former Biden adviser raked in millions. Now, new reports suggest oil will soon hit $130 a barrel.
Fox Business writes:
Rystad Energy chief executive Jarand Rystad wrote in an analyst note this week that crude oil prices could surge to $130 a barrel in the wake of the Ukrainian invasion, “squeezing” consumers who will face steeper prices at the pump.
That’s because the conflict threatens to jeopardize up to 1 million barrels a day of crude that flows through Ukraine and the Black Sea. The long-term disruptions could be “far more significant,” Rystad said.
U.S. consumers are already facing sticker shock at the pump. A gallon of gas, on average, cost $3.57 nationwide on Friday, according to AAA – up from $2.67 a year ago. In California, gas prices are well over $4 per gallon.
Russia is the world’s second-largest producer of both oil and natural gas; a conflict or sanctions could disrupt the oil market even further at a time when high demand is outpacing tight supplies. OPEC and other oil-producing nations, together known as OPEC+, have resisted calls to boost supply.
Germany already halted the certification of the Nord Stream 2 gas pipeline from Russia, while the U.S. and the European Union have also levied harsh financial sanctions against Moscow after it launched a wide-ranging attack on Ukraine that reverberated throughout the rest of the world.
And I have bad news for leftists. Their silly little electric cars won’t save them from facing this disaster. Because gas and motor oil aren’t the only products we get from crude oil.
In fact, here’s an interesting list of products made from petroleum.
You can bet the price on every one of these will soon rise.
|Solvents||Diesel fuel||Motor Oil||Bearing Grease|
|Ink||Floor Wax||Ballpoint Pens||Football Cleats|
|Upholstery||Sweaters (that explains the itchy sweater I have at home)||Boats||Insecticides|
|Bicycle Tires||Sports Car Bodies||Nail Polish||Fishing lures|
|Cassettes||Dishwasher parts||Tool Boxes||Shoe Polish|
|Motorcycle Helmet||Caulking||Petroleum Jelly||Transparent Tape|
|CD Player (do people still have these?)||Faucet Washers||Antiseptics||Clothesline|
|Curtains||Food Preservatives||Basketballs||Soap (that explains why soap doesn’t clean oil off your hands)|
|Percolators||Life Jackets||Rubbing Alcohol||Linings|
|Skis||TV Cabinets||Shag Rugs||Electrician’s Tape|
|Tool Racks||Car Battery Cases||Epoxy||Paint|
|Mops||Slacks||Insect Repellent||Oil Filters|
|Roofing||Toilet Seats||Fishing Rods||Lipstick|
|Denture Adhesive||Linoleum||Ice Cube Trays||Synthetic Rubber|
|Speakers||Plastic Wood||Electric Blankets||Glycerin|
|Tennis Rackets||Rubber Cement||Fishing Boots||Dice|
|Nylon Rope||Candles||Trash Bags||House Paint|
|Water Pipes||Hand Lotion||Roller Skates||Surf Boards|
|Shampoo||Wheels||Paint Rollers||Shower Curtains|
|Guitar Strings||Luggage||Aspirin||Safety Glasses|
|Antifreeze||Football Helmets||Awnings||Eyeglasses (I thought they were made from glass)|
|Combs||CD’s & DVD’s||Paint Brushes||Detergents|
|Anesthetics||Artificial Turf||Artificial limbs||Bandages|
|Dentures||Model Cars||Folding Doors||Hair Curlers|
|Cold cream||Movie film||Soft Contact lenses||Drinking Cups|
|Fan Belts||Car Enamel||Shaving Cream||Ammonia|
|Refrigerators||Golf Balls||Toothpaste (Yuck)||Gasoline|
It may take several months for the effects to roll through the supply chain completely, but eventually, the rising costs in producing these goods will give way to increased costs elsewhere. And you thought Bidenflation was bad already… all I can think is “please God. Let there be another term with someone like Trump in the White House. I promise we won’t piss away “winning” this time.”