Gas prices are hitting record highs even as crude oil prices drop. According to data provided by the U.S. Energy Information Administration (EIA), the average gallon of gas in the U.S. hit $4.86 in the first week of June. For context, in May, the average retail price (RP) for regular-grade gasoline averaged $4.44 per gallon.
In the EIA’s most recent short-term energy outlook, the Brent crude oil spot price averaged $113 per barrel in May and is anticipated to drop to $108 per barrel in the latter half of 2022 and decline to $97 per barrel at some point in 2023.
Ultimately future prices of crude oil and retail gasoline are impacted by numerous global factors, including the volatility in Europe and present and future sanctions imposed on Russia. One thing is clear, though, oil inventory levels remain low, and the U.S. is in the throes of an energy crisis.
What effect will this volatile market have on clean energy and climate change goals? It should strengthen America’s resolve to become less reliant on fossil fuels. The focus may be on increased oil production in the short term, but this crisis only underscores the need for renewable energy sources.
However, increasing fossil fuel production appears to be a short-term solution favored by the government to lift the U.S. out of its current energy crisis despite how counterproductive it is to reaching climate change targets.
That’s what Secretary of Energy Jennifer Granholm echoed on March 9, 2022, when speaking at CERAWeek, an annual energy conference in Houston, Texas. She stressed the need to stabilize the market by increasing the short-term energy supply via oil to mitigate the financial impact on American families. The Biden administration has already tapped strategic oil reserves and enacted programs to accelerate America’s move toward renewable energy.
Acknowledging that increased oil production is not a viable long-term solution, Secretary Granholm said, “We’ve also got to reckon with the impact of climate change—and the clean energy transition that isn’t just coming; it’s here—seventy percent of voting Americans support the clean energy transition.”
Renewable energy experts say that we would be in a much better position now if we had taken bolder steps toward becoming less reliant on fossil fuels a decade ago. It is better to be late in pursuing cost-effective alternative solutions than never to try at all. The U.S. cannot pull itself out of its current situation solely by focusing on renewable energy sources, but acting now will help avoid the next crisis.
In March 2022, the associate director of policy and analysis at CU Boulder’s Renewable and Sustainable Energy Institute, Jeffrey Logan, spoke about what the current oil and gas crisis means for the future of renewable energy. Mr. Logan has nearly 30 years of experience in energy policy analysis, low-carbon market development, energy security, and strategic planning.
Logan was straightforward when asked to comment for CU Boulder Today about the emphasis the current oil and gas crisis places on the need for greater access to renewable energy. He said, “The current situation—like every energy crisis we face—tells us that we should have taken stronger action much earlier to lower our reliance on fossil fuels. If we had taken bolder action starting 12 years ago, when the costs of wind and solar fell on par with fossil alternatives, we could have largely insulated ourselves from today’s rising prices and climate-driven disasters.”
Sharing his thoughts about what the U.S. could do to reduce its dependence on volatile oil and gas markets, Logan said, in part, “Most of the clean energy substitutes will take time to roll out, but investment in energy efficiency, electric vehicles, solar and wind energy, longer-duration energy storage and replacing natural gas boilers/furnaces with heat pumps can make cost-effective contributions if pursued vigorously. Solutions are out there.”
Now is the time to prepare for the next global crisis, be it geopolitical or economic, and strengthen our resolve to be energy independent as we strive to meet climate change goals. In the Northeast, companies like Green Development LLC are already making a positive impact and will play an essential role in reaching net-zero emissions by 2050.