"Will Environmentalists Bring The American Oil Industry To A Halt Again?" Will the environmental media's biased view prevail over US energy policy?

[For an example of a certain amount of media bias, you should do a Google search for "recent EPA Colorado spill" and "Johns Hopkins fracking study." Yes, there was a recent EPA Colorado spill; and, no, there is no real evidence about fracking and headaches in Johns Hopkins recent study. The differences between the "reporting" on each event is stark.  As I wrote before, it is time to have an open, full-throated debate on fracking and national environmental policy.  Steve]

Will Environmentalists Bring The American Oil Industry To A Halt Again?

BY Panos Mourdoukoutas, Forbes 

That would be good news for investors on the long side of the oil market, but it’s bad news for America, as it will once again be subject to the whim of the Saudis. Then came a couple of serious accidents that caused a great deal of harm to the environment and stir public anxiety over the growth of the American oil industry. A 1968 tanker accident created a massive oil spill in Europe, for example; and the 1969 well blowout in the Santa Barbara Channel, off the California coast.

There was a time when America was the world’s largest oil producer, setting the rules in the oil market. That was back in the first seven decades of the 20th century. But environmentalist movement against oil and gas exploration in the US was in its infancy back then.

American environmentalists brought the American oil industry to a halt before, helping Saudi Arabia become the world’s largest oil producer. And they will do it again, if they manage to halt fracking. 

These events sparked the beginning of the environmentalist movement as we know it today, stalling the growth of the US oil industry.

“Sensational media coverage and strong public reaction to the Santa Barbara spill spawned the beginnings of the environmental movement as we know it today,” writes Matthew R. Simmons In Twilight In The Desert. ”From the Santa Barbara spill onward, environmentalists mounted a steady and well-funded attack on further US oil exploration and development. This fierce environmental opposition stalled Alaskan oil production for almost a decade before a pipeline was finally built.”

“In the meantime, US offshore exploration for both oil and gas in all coastal regions except the Gulf of Mexico also ground to a halt. Ultimately, political opposition banned any further exploration for new oil and gas in any part of the US Pacific and Atlantic waters, and even in the eastern third of the Gulf of Mexico, leaving only the coastal waters of Texas, Louisiana, and Alabama open for further oil and gas development.” 

That included squeezing Americans anytime Washington didn’t ally with Riyadh policies, like the 1973 oil embargo that send Americans to the long gas lines.

Then came fracking, which turned America into the world’s largest oil producer. That’s why Saudi Arabia has been trying to put American frackers out of business by flooding world markets with oil – to drive oil prices lower and marginalize frackers out of business.

American frackers have nonetheless demonstrated an exceptional ability to come back anytime oil prices heads north, however — as evidenced by recent data on oil rigs. 

But so has the environmentalist movement, which won’t let any American election go to waste, renewing their calls to regulate fracking.

While it is still unclear whether environmentalists will have their way, one thing is clear: to combat American frackers and the return of the US oil industry to its former position as top world oil producer, Saudi Arabia will need some help from environmentalists.

The kind of help they provide in the late 1960s and early 70s, that is.

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Panos Mourdoukoutas is Professor and Chair of the Department of Economics at LIU Post in New York. He has published several articles in professional journals and magazines, including Barron’s, The New York Times, Japan Times, Newsday, Plain Dealer, Edge Singapore, European Management Review, Management International Review, and Journal of Risk and Insurance. He has also published several books, including Collective Entrepreneurship, The Ten Golden Rules, WOM and Buzz Marketing, Business Strategy in a Semiglobal Economy, China’s Challenge: Imitation or Innovation in International Business, and New Emerging Japanese Economy: Opportunity and Strategy for World Business. He has  traveled extensively throughout the world giving lectures and seminars for private and government organizations, including Beijing Academy of Social Science, Nagoya University, Tokyo Science University, Keimung University, University of Adelaide, Saint Gallen University, Duisburg University, University of Edinburgh, and Athens University of Economics and Business.

His interests: Global markets, business, investment strategy, personal success.