As gas prices surge, Big Oil climate change hearing tone-deaf

Gas prices are averaging $3.40 per gallon nationwide: AAA

The CEOs of Exxon Mobil, Shell Oil, Chevron and BP are getting an earful from House Democrats on climate change, yet Americans are paying the most for fuel in at least seven years, threatening U.S. economic growth.

Gas prices are averaging $3.40 across the nation, per AAA, and approaching $5 per gallon or higher in areas of California. 

BIDEN RECONCILIATION FRAMEWORK COSTS $1.75T, INCLUDES $1.995 TRILLION IN TAX HIKES, WHITE HOUSE SAYS

Ticker Security Last Change Change %
XOM EXXON MOBIL CORP. 61.25 -2.23 -3.51%
CVX CHEVRON CORP. 114.51 -2.68 -2.29%
BP BP PLC 25.96 -1.69 -6.11%
RDSA n.a. n.a. n.a. n.a.

The Democratic House Oversight and Reform Subcommittee on the Environment’s "Fueling the Climate Crisis: Exposing Big Oil’s Disinformation Campaign to Prevent Climate Action" hearing is dubbed as an "industry-wide campaign to spread disinformation about the role of fossil fuels in causing global warming."

Ticker Security Last Change Change %
UGA UNITED STATES GASOLINE FUND LP PARTNERSHIP UNITS 36.81 -4.71 -11.34%

Some of the evidence they will present is a report that in the late 1970s, the American Petroleum Institute had formed a committee called the "CO2 and Climate Task Force," which included representatives of many of the major oil companies, to privately monitor and discuss the latest developments in climate science. Of course, in the 1970s, many scientists disagreed about the impact of fossil fuels on the planet. Some thought it could drive us into another ice age. One should also point out that most of the data from the '70s showing the potentially dire consequences of climate change were wrong by a long shot. 

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If you go back in history, Congress had more issues with Big Oil for not providing enough oil and keeping oil prices high for their profit and very little concern about their impact on climate. 

Ticker Security Last Change Change %
USO UNITED STATES OIL FUND L.P. 49.63 -6.25 -11.18%

Yet one must also ask about what Congress knew about climate change and when they knew it.

They only need to go to the congressional record to see what an exact science climate change is.  

On June 23, 1988, NASA scientist James Hansen testified before the Senate Committee on Energy and Natural Resources that he had a "high degree of confidence" in "a cause-and-effect relationship between the greenhouse effect and observed warming." 

According to The Wall Street Journal, Mr. Hansen had three possible scenarios for the future of carbon dioxide emissions, including Scenario C, which he deemed highly unlikely: constant emissions beginning in 2000. In that forecast, temperatures would rise a few tenths of a degree before flatlining after 2000. 

Yet his highly less likely and less damaging forecast was the correct one. Thirty years of data have been collected and Scenario C showed that global surface temperature has not increased significantly since 2000, discounting the larger-than-usual El Niño of 2015-16. Assessed by Mr. Hansen’s model, surface temperatures are behaving as if we had capped 18 years ago the carbon-dioxide emissions responsible for the enhanced greenhouse effect.

The Journal also pointed out that "Models devised by the United Nations Intergovernmental Panel on Climate Change have, on average, predicted about twice as much warming as has been observed since global satellite temperature monitoring began 43 years ago."

In the meantime, the country and the world need fossil fuels. A rash transition from fossil fuels in Europe is causing record-breaking gas and natural gas prices across the continent. Wind and solar energy sources are failing and the closing of nuclear power plants and natural gas production is causing inflation and fears that Europe may be facing heating shortages this winter. In the U.S., we are also feeling the impact of the drilling moratorium, pipeline cancellations and major underinvestment in fossil fuels in part because investors are afraid that if they do they might get called before a House committee.

This winter, because of President Biden's energy policies, many Americans won't be able to heat their homes or be able to afford gas for their gas tanks. The rising cost of fuel on Biden’s watch could also lead to food shortages, not only making the transportation of food more expensive but raising the cost of fertilizers that could have a devasting effect on the food supply chain. In  France, corn farmers are being told to leave crops unharvested in the latest sign of how soaring energy prices are heightening the risk of global food inflation. This will have a major detrimental impact on the poor and middle class in this country

It would be more important to the American People to have them ask the question of a better way to work with the industry for a better transition off of fossil fuels without bankrupting the poor and allowing us to fuel the American economy. If you want to "Build Back Better," you are going to have to admit that it is going to take a lot of fossil fuels. Without them, you can't build back America or anything. 

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Phil Flynn is senior energy analyst at The PRICE Futures Group and a FOX Business Network contributor. He is one of the world's leading market analysts, providing individual investors, professional traders, and institutions with up-to-the-minute investment and risk management insight into global petroleum, gasoline, and energy markets. His precise and timely forecasts have come to be in great demand by industry and media worldwide and his impressive career goes back almost three decades, gaining attention with his market calls and energetic personality as writer of The Energy Report. You can contact Phil by phone at (888) 264-5665 or by email at pflynn@pricegroup.com.