Thousands have died. Millions are in quarantine. Almost all of us are in the path of what has now been declared a global pandemic that is shutting down whole cities. For most Americans, the coronavirus is a frightening reminder of our personal and social vulnerabilities.
To oil industry executives, though, COVID-19 smells like opportunity. Citing a plunging demand for oil linked to the virus and the industry’s global failure to curb its own production, U.S. oil companies just asked the Trump administration for a long list of special handouts.
They didn’t have to wait long for an answer.
Trump and Senate Republicans are reportedly considering various plans to offer low-interest loans to oil companies, making it even easier to drill and frack our beautiful public lands, defer tax payments and cut royalties for oil production on federal property, and perhaps even use public money to buy up the companies’ crude for the Strategic Petroleum Reserve.
These demands aren’t really new. The industry, which already gets billions in subsidies every year, has long fought to evade royalties for oil taken from our public lands, and the Trump administration has happily helped companies pay taxpayers as little as possible.
But the coronavirus is being used as fresh wrapping for these old, bad ideas. And if oil companies’ wish list is granted by Trump officials eager to appease shale oil billionaires like Harold Hamm, it’ll be one of the dumbest, most damaging things the administration has done for this polluting industry.
We’ll see even more destructive drilling and fracking on public lands at a time when the administration is already opening natural treasures like the Arctic National Wildlife Refuge and California’s central coast to the oil industry.
We’ll see oil companies do even more harm to our climate even though fossil fuel production on federal lands already causes about a quarter of all U.S. greenhouse gas emissions. The climate crisis requires that we phase out this polluting industry, not unleash more drilling.
One need not be a genius — stable or not — to spot the major logical flaw here. If the Trump administration makes it even cheaper and easier to drill on our public lands, what will oil companies do?
They’ll pump more oil, contributing to the glut and drive prices lower.
Oil companies’ willingness to ignore that obvious fact underscores something fundamental and frightening about this industry: It seems to care almost nothing about its own future, let alone ours.
Indeed, short term thinking is at the heart of the recent rise of the U.S. oil industry, which was sending massive and growing amounts of crude into an oversupplied global market long before the coronavirus. Determined to produce as much oil and gas as possible, regardless of the cost to our climate, companies borrowed massive amounts of money to drill and frack and drill some more.
Moody’s estimates that the U.S. oil and gas industry has almost $90 billion of rated debt coming due in next few years. Most is junk or rated just above junk, according to CNBC. Well before COVID-19 became a household name, the industry faced a wave of bankruptcies.
Yet powerful people are making lots of money from this house of cards, in part because the oil industry has found a long list of ways to stick the public with the costs of this boom.
Oil companies, for example, have simply walked away from more than a million uncapped oil and gas wells across the country, leaving governments to try to plug the wells and clean up the drill sites, which can pollute our air and water and harm our climate.
Now, having brought in untold billions, the industry faces new challenges and wants taxpayers to pay even more to bail it out. Oil companies also seem to see coronavirus as an excuse to further cripple protections for our public lands — changes that would no doubt last far beyond the current pandemic.
The Trump administration is already facing backlash for planning new handouts for a reckless, polluting industry, which includes some of the world’s most profitable companies.
Let’s invest in public health. Let’s help people thrown out of work by the coronavirus and the fossil fuel industry’s reckless boom and bust approach. Let’s fund renewable energy development and measures to hasten a just transition to a clean energy future that will create family sustaining jobs for American workers.
But oil companies don’t deserve another cent of public money.
Kassie Siegel is director of the Center for Biological Diversity’s Climate Law Institute.