TUSCALOOSA, Ala. — U.S. energy policies — specifically President Obama’s delay of a decision pending further environmental-impact study for a part of the Keystone Pipeline — are pushing Canada into a closer trading relationship with China.
Just ask Canadian Prime Minister Stephen Harper, who in January of this year told Mr. Obama that the delay meant Canada would focus on “diversifying” energy exports.
Or ask Canadian Natural Resources Minister Joe Oliver, who told the Canadian Broadcasting Corp. that same month that “we currently have one customer (the U.S.) for our energy exports. That customer has said that it doesn’t want to expand at the moment. So it certainly intensifies the broad strategic objective of the government to diversify to Asia.”
Will China want to buy Canadian oil? Absolutely! China’s hunger for petroleum products will continue to grow. Chinese car ownership is still below U.S. levels in 1920. Even if all future car sales in China are hybrids and even if China’s frenetic economic growth slows, as Chinese car ownership rises, the demand for petroleum will soar over the next two decades. And India is also developing a taste for automobiles. If we don’t want Canada’s oil, there are many who do. This is a major mistake for three reasons.
First, domestic oil production is insufficient to meet U.S. needs. According to the Energy Information Administration, oil provides 94 percent of our transportation energy and 37 percent of our total energy. But domestic production met only 45 percent of our 2011 oil needs. Oil also is a key raw material for the U.S. chemical, plastics, and pharmaceutical industries. It is impossible to avoid importing oil.
Our three largest foreign suppliers are Canada (29 percent), Saudi Arabia (14 percent) and Venezuela (11 percent). Of those, only Canada both respects human rights and shares our commitment to democratic government. In short, Canadian oil is what Canadian journalist Ezra Levant terms “ethical oil” — oil that does not undermine our values by funding corrupt and hostile regimes.
Second, buying Canadian oil puts dollars in the hands of one of our best trading partners. In 2009, Canadians invested $261.3 billion here. Canada is the No. 1 export market for 34 U.S. states; $1.6 billion in goods and services cross the U.S.-Canada border daily. By contrast, sending dollars to Saudi Arabia and Venezuela does little for the U.S. economy.
Third, Canada is a reliable energy supplier. With approximately 12 percent of total world reserves, Canada ranks third in the world. And Canadian oil largely comes to us via pipeline, environmentally safer and militarily more secure than ocean transportation.
Why is the Obama administration so set on delaying a decision on a secure source of ethical oil? A crucial financial element in Obama’s re-election strategy is the support of environmentalists such as Hollywood’s Robert Redford and Laurie David.
These activists don’t mind if oil prices go up as they can afford higher gas prices. But they are passionately committed to reducing other Americans’ use of oil and so object to any efforts to tap into Canadian oil.
And — at least until recently — the administration’s top energy policymaker explicitly focused on raising gasoline prices. In 2008 Energy Secretary Steven Chu said his goal was to raise the price of gasoline to European levels — about $8 a gallon. Although Chu has since said he no longer holds that view, the National Journal notes that Chu “seemed to equivocate, pause, and stumble over his words” when backtracking, making his disavowal less than credible.
Canada is one of our oldest allies and best trading partners. “Defriending” Canada on energy is not in our national interest — militarily, economically or environmentally.
• Morriss is a professor at the University of Alabama.





Comments (9)
Add commentThis is just a no brainer.
This is just a no brainer. Oil that doesnt require us to fund anti-US nut jobs, doesnt require shipping it across the globe, supports our friendly neighbors... Buy local, Eh?
Bunch of fear mongering
This guy raises the specter of China over and over...
Oil is a fungible product on the world economy. That means China will buy oil from somewhere regardless. If they don't buy it from Canada, because we're buying it, they'll buy it from those evil despotic regimes. Either way, the despots get their money, regardless of our "values". If we're so worried about our values in regards to oil, perhaps we should just use less of it.
As far as our trading partner, if China gives Canada a bunch of money for their oil, doesn't that still put money in the hands of our largest trading partner?
I wish university professors would stick to teaching and research instead of lame political hack jobs. He must be angling for a job at the heritage institute.
Misleading
"Why is the Obama administration so set on delaying a decision on a secure source of ethical oil?"
The delays are a result of environmental concerns expressed by the states affected, including some from Republican lawmakers. Once those concerns are addressed, Keystone will likely get approval. However, sands oil is the dirtiest oil on the planet, so "ethical oil" is a misnomer. Also, a pipeline to Prince Rupert for delivery to China may be pursued regardless of US action, but will require First Nations approval and is far from guaranteed.
US energy policy in a sentence:
“we currently have one customer (the U.S.) for our energy exports. That customer has said that it doesn’t want to expand at the moment..." - Canadian Natural Resources Minister Joe Oliver
brilliantly sums up the Obama Administration's energy policy - reacting for the moment with no long term plan. Sure, green energy sounds GREAT, but that's an objective and there is no plan to get there. That's why BHO deferred on Keystone: wasn't politically advantageous at the moment, upsets green voters, try again after November (maybe).
Latitude -
Nicely said. Interesting how global connectedness is missed by those who just want to use some vague 'morality' to push other countries around. 'ethical oil' indeed.
balderdash
This is another of magic miracles cures for the US energy promotions. First we really do not know that the Canadian oil sands landed in Texas would be any less expensive than any other imported crude. Then we can toss in the expanded oil production in North Dakota and now several other major finds expected to be larger than North Dakota's.
Sure there is lots of folks who want this pipe line. Most of them pushing the project seem to have ties to the pipeline construction industry that stands to make some nice profits from its construction even if its is never used.
Claiming Canada will just ship its crude to China is a great scare tactic. For in reality if the pipeline to Texas is built the Canadians will still be looking to expands its market for crude.
Diversification of energy supplies . . .
. . .is the only viable energy security policy that is based in reality. Emphasis on home grown energy or ethical energy, although a part of the equation, is small part of the sum total. It is more cost effective to maintain the lines of supplies with present company, unsavory or otherwise. It is our Faustian bargain to fill our thirst for cheap energy.
This right wing loon again.
This right wing loon again. Unless we support tar sands china gets them? Who cares. China is a rising power with big energy needs. They will expand around the world. Get over it and get a more modern worldview, Bubba.
Our country needs to reform
Our country needs to reform our energy policies not canadian oil