The global economy and free trade agreements prompted American manufacturers to offshore facilities and jobs. That same interlocking network of production and distribution is being substantially impacted by EU and U.S. sanctions against Russia. With the EU rejecting Russian oil and natural gas in protest of the war in Ukraine, European plants are on the brink of going dark. If West Texas and other crude oil producing areas can resurrect pre-pandemic barrels per day levels and drop the price of diesel, America could very well regain some of its lost manufacturing base. That means more good-paying jobs for truckers.
“For decades, European industry relied on Russia to supply low-cost oil and natural gas that kept the continent’s factories humming,” the Wall Street Journal reports. “Now Europe’s industrial energy costs are soaring in the wake of Russia’s war on Ukraine, hobbling manufacturers’ ability to compete in the global marketplace. Factories are scrambling to find alternatives to Russian energy under threat that Moscow could abruptly turn off the gas spigot, bringing production to a halt.”
The U.S. achieved energy independence and emerged as a net exporter of crude oil before the pandemic disrupted the economy. In November 2019, U.S. crude oil production hovered at 12.966 million barrels daily, and diesel stood at $3 per gallon nationally.
With diesel now above $5.50 and crude oil production well below pre-pandemic levels, inflation fears, and The Fed raising interest rates, product-makers likely have no stomach for investment risk-taking. By that same token, as the EU sanctions against Russia cause a self-inflicted economic wound, demand for products will be met somewhere. America has the largest oil cache and the ability to access it right now.
“The phaseout of Russian supplies risks putting European industry at a long-term competitive disadvantage unless manufacturers can deploy technologies that will sharply reduce their fossil-fuel consumption,” the Wall Street Journal reports. “But many of these technologies, such as using wind and solar energy to power chemical factory furnaces or hydrogen to make steel, are years from becoming commercially viable and will require massive investments, executives say.”
Reports coming out of the EU indicate that manufacturing plants are already shutting down as energy costs soar and competition from the U.S., Middle East, and other regions rises. That’s largely because Russian Pres. Vladimir Putin already cut off Bulgari, Poland, and Finland in response to EU and American sanctions. Much of Europe is on the brink of fuel rationing, and supplies will only further dwindle unless EU countries comply with Russia’s demand to pay in Rubles or gold. Russia supplied 40 percent of Europe’s natural gas in 2021.
Although compassionate people support Ukraine and want the war to end, the U.S. has an opportunity to regain portions of its unnecessarily offshored manufacturing base. By increasing oil production to the levels established in 2019, supply would close in on demand, drive down cost, and open the door to manufacturing and good-paying trucking opportunities.
The implication here is that this mis-administration cares about America. It doesn’t, so the entire discussion is moot.