At least one financial industry CEO is not so mesmerized by the environmental, social, and governance (ESG) movement that he has lost their mind. So while BlackRock CEO Larry Fink talks about the virtues of high gas prices, JPMorgan Chase CEO Jamie Dimon provides an excellent counterbalance. In an interview on CNBC, Dimon criticized the Biden administration’s energy policy and called on the U.S. to take a leadership role.
While Fink believes rising energy prices will reduce the “green premium” and cause people to embrace renewables, Dimon’s perspective is much more realistic. The Biden administration has decided to beg some of the worst petro dictators in the world to produce more oil rather than taking it out of the ground at home. As Dimon observes, this has not reduced fossil fuel use:
“Well, I think we’re getting energy completely wrong, which is, you know, ever since this war started, you know that Europe is going to have a problem.”
“And that it was pretty predictable that Putin was going to cut off some gas and some oil, and oil price would go up and, by the way, for the climate folks here, it’s made the climate worse because people have this bad assumption that higher oil prices and gas prices reduce consumption, reduce CO2. No. Poor nations, India, China, Indonesia, Philippines, Vietnam, are turning back on coal plants, as are rich nations called Germany, Netherlands, France.”
NIMBY energy policies, like those adopted by Biden, Germany, and other EU countries, have always made the world dirtier. Western nations outsourced their fossil fuel production to countries in the Middle East and Russia that use less environmentally sound extrusion practices. China makes much of the solar and wind equipment they install, and the CCP is building record numbers of new coal plants. These policies do not reduce CO2. They just move the source to another country.
Now, Biden is refusing to fill in any shortages caused by the war in Ukraine. However, the administration’s policy keeps the apocalyptic climate freaks quiet at home. It also keeps them delusional. Dimon was the CEO who had to burst Representative Rashida Tlaib’s green bubble when she asked him to commit to divesting from fossil fuel companies during congressional hearings. “Absolutely not, and that would be the road to hell for America,” Dimon responded.
It appears this is a sincere view, and Dimon is worried the Biden administration is putting the U.S. on that road. During the interview, he warned:
“We have it completely backwards, and in my view, America should have been pumping oil and gas. And it should have been supported, you know, we’re trying to have our cake and eat it, too, a little bit. And so you have the, you have the problem this winter, which it sounds like they’ve got enough supply to get through this winter.
But we have a longer term problem now, which is the world is not producing enough oil and gas to reduce coal, make the transition, create security for people. So I would put it in a critical category. And this should be treated almost as a matter of war at this point, nothing short of that.”
During the interview, the interviewer noted that Dimon is the only CEO of a major financial institution that weathered the 2008 financial crisis. Now he is warning Americans to be ready for anything:
“People, don’t be surprised. Like I was not surprised that Nordstream 1 would be blown up. I won’t be surprised if another pipeline or another tanker in the wrong place. People need to be prepared at this moment. And obviously, America needs to play a real leadership role. America is the swing producer, not Saudi Arabia. And we should have gotten that right starting in March. It’s almost too late to get it right. Because obviously these are longer term investments.”
Dimon is correct. America suffers from a shortage of refining capacity that is not likely to get remedied as long as firms like BlackRock and the Biden administration keep attacking the oil and gas industry. Even California Governor Gavin Newsom is getting in on the action, threatening to punish oil companies for “rank price gouging.” Of course, this is just political theater, as Valero’s vice president for state government affairs, Scott Folwarkow, noted in his response to an inquiry from the California Energy Commission:
As to separation between California prices and the prices in the rest of the United States, we can offer the following information. For Valero, California is the most expensive operating environment in the country and a very hostile regulatory environment for refining. California policy makers have knowingly adopted policies with the expressed intent of eliminating the refinery sector. California requires refiners to pay very high carbon cap and trade fees and burdened gasoline with cost of the low carbon fuel standards.With the backdrop of these policies, not surprisingly, California has seen refineries completely close orshut down major units. When you shut down refinery operations, you limit the resilience of the supply chain.
It is not the pricing strategy of the oil companies. The political decision-making of Democrats beholden to the apocalyptic climate lobby is responsible for higher prices now and in the future if there is no course correction. More CEOs need to speak out about the obvious consequences of the Biden administration’s policies like Dimon does.