Framing this as the US “losing control” misses one of the points i.e what’s actually happening in energy sector. Oil worked as a lever of power precisely because it was scarce, centralised, and geopolitically choke-pointed. Renewables will flip that model. Sun and wind don’t care about borders, navies, or petrodollars.
ericmay|2 months ago
But I think this past year really changed the direction of the US and to a lesser extent the EU with respect to oil and gas versus renewables.
As the US has realized at the institutional level that China has secured a very strong position on refining rare earth materials into batteries and other green technology it is doubling down on oil and gas as the energy choice for the foreseeable future, climate change be damned. Not that China ever really cared about the climate, they just, for good reasons, wanted an alternative energy production source because even if they seized Taiwan the US Navy can bring oil and gas imports to near 0. Pipelines from Russia are sitting ducks too, so not much reprieve there.
US is putting $40 billion into Al Udeid and signing AI deals with the Middle East powers, and is close enough on a deal to legitimize Israel. Add Venezuela. You can see where this is going.
The EU politically wants to switch to green tech but it’s facing a problem which is doing so will result in effective deindustrialization since they would wind up buying most equipment from China including cars. The EU either did or is about to shelve the requirement that cars are EVs by 2035. I expect this to be fully repealed. While the EU likes to not mince words about US tariffs, they’re ultimately heading in the same direction. China had a $1 trillion export surplus. If the US isn’t buying their subsidized products who is? Brazil? Right now it’s Europe, but do you think Germany will let its manufacturing sector go away? If so I have a ticket to sell you to the next AfD rally. The product dumping from China is going to be too much and in a judo move the west will be able to use China’s manufacturing capacity against it. Nice factories you have there, too bad nobody buys anything you make (relatively speaking).
So the EU is sitting between two oil and gas energy superpowers oh and the Middle East is just around the bend. Politically they’ll still work on climate change initiatives but as push comes to shove, and with China overplaying its hand with export controls on rare earth materials and creating more panic in Brussels (never mind China's support for Russia invading Ukraine), the EU will generally maintain an oil and gas industrial direction, if I were to guess.
I’m not pro gas/oil or anything like that. Drive an EV and love it. But that’s my fun armchair take on what’s going on here.