Energy expert talks about the future of US Energy
The main message of Fine’s presentation was that the U.S. would, very quickly, move away from global energy policies based on combating climate change and toward becoming economically nationalistic.
FARMINGTON — The Trump administration will create a "new world order" for American energy producers, energy expert Daniel Fine told a packed room at the San Juan College School of Energy today Friday.
Fine recently made a trip to Washington, D.C. to receive briefings from energy insiders who served in previous administrations, and shared what he learned during those encounters in regards to near-term changes in the American energy industry.
“A new world order is in the making now as regards to energy,” Fine told the group that included local industry officials and community leaders.
The main message of Fine’s presentation was that the U.S. would, very quickly, move away from global energy policies and toward becoming more focused on what would best advance U.S. energy goals.
“A radical change is coming concerning what we are, and this means adoption of economic nationalism, or ‘America First.’ This translates also to ‘American Oil First,’ beginning early next year,” said Fine, associate director at New Mexico Tech’s Center for New Mexico Energy Policy. Fine said the views he expressed are his own.
Fine said the U.S. will quickly move away from supporting policies designed to fight climate change.
“Obama’s climate change energy policy will now be completely disconnected, and Trump will soon announce that we will no longer be in agreement with the Paris Treaty,” said Fine, referring to the ambitious climate change agreement adopted by more than 190 countries. “This will be a very radical change for us and the world.”
Fine told industry officials present that all of the regulations they confronted as small producers were created under the umbrella of climate change.
“That umbrella has been pulled out, all of that will go away, similar to (what happened during President Ronald Reagan's tenure),” predicted Fine. “What we have now is a reversal, and a rollback on all industry regulation.”
Fine predicted that oil and gas policy will become part of national security, similar to what the steel industry was in the 1940’s and 1950’s. This will lead to Trump creating a new national diplomacy.
“For example, if an outside international investor is interested in buying infrastructure like pipelines, etc., they will have to go through a review with Donald Trump,” he said. “Under globalism, there can be no local development of prices, but with nationalism, all the prices are set within national boundaries depending on economies and demands.”
Trump is thinking a lot about natural gas, said Fine, and with oil and gas being declared essential to national security, the fact that the nation's second largest gas field is located in New Mexico means more good news for the state. The U.S. will need new markets for the additional development of gas, and will be looking to Mexico as a natural trading partner, he said. The “walls” Trump has spoken about when referring to Mexico, said Fine, will become pipelines.
Fine said Trump is looking closely at how much oil the U.S. has been importing, and said he and senior adviser Stephen Bannon are looking toward building a “North American Market,” which will begin and end with American producers within U.S. frontiers and borders.
This will usher in an effort by Trump to end global energy interdependence, Fine said, and will be accomplished by personal telephone calls and bilateral agreements.
“In 1973, the U.S. was embargoed by OPEC for five months – there was no supply of oil and that meant panic. That caused a need to move toward interdependence, globalism, and the need to adjust to a new world partnership,” he said. “Bannon and Trump will be taking us out of the Paris agreement, which pushes climate change and alternate sources of energy.”
Another rather quick change, said Fine, will be the dismissal of individuals within DOE and BLM who pushed for more regulation related to combating climate change.
“They will be asking, ‘who got us involved in the Paris agreement?’ Same with BLM, they will ask, ‘were you involved in making new regulations and rules? Then you’re finished,” he said. “BLM will become like it was in 1980 – they administered the rules, but they didn’t make new rules. They will be there to enforce existing rules, so industry and the government can cooperate.”
Fine predicted we will see some of these changes as quickly as this weekend, when non-OPEC countries meeting in Moscow agree to cut oil production by 600,000 barrels a day, pushing up the price of a barrel of oil significantly.
“Trump is on this, through his phone and by talking to people. He wants to see the OPEC deal by Sunday, and prices could raise to close to ($60) per barrel. The new order will be done by late summer, it will move very quickly,” he predicted.
Fine ended his presentation by stating that coal will also enjoy a comeback.
“Obama decimated the (Office of Fossil Energy) with reductions and demotions in rank, but the coal office will be rebuilt,” he said. “The EPA will be out, and (Arizona Public Service) and others in the coal industry will be replenished.”
Leigh Black Irvin is the business editor for The Daily Times. She can be reached at 505-564-4621.