WASHINGTON – Bipartisan momentum is building on Capitol Hill to ban U.S. imports of Russian oil that help fund Moscow’s invasion of Ukraine, but Democrats and Republicans disagree on what should be done to minimize the impact of such a move on gasoline prices.
The White House has resisted a growing chorus of calls to bar oil imports from Russia, seeking to balance punishing the Kremlin with concerns over rising prices and inflation, but Congress may force President Joe Biden’s hand. On Monday, a bipartisan group of lawmakers announced legislation to ban imports of Russian energy and suspend normal trade relations with both Russia and Belarus, whose government has supported Russian President Vladimir Putin’s effort to topple the Ukrainian government.
Idaho Sen. Mike Crapo, the top Republican on the Senate Finance Committee, announced an agreement on the forthcoming bill with the panel’s Democratic chairman, Sen. Ron Wyden of Oregon, as well as the leaders of the House Ways and Means Committee, Reps. Richard Neal, D-Mass., and Kevin Brady, R-Tex.
“Taking these actions will send a clear message to Putin that his war is unacceptable and the United States stands firmly with our NATO allies,” the four lawmakers said in a joint statement. “While Congress needs to do more, as the congressional leaders with jurisdiction over our nation’s trade policy, we are committed to using the tools at our disposal to stop Russia’s unconscionable and unjust war on Ukraine and to hold Belarus accountable for its involvement.”
Both parties have gotten behind the effort to cut off crude oil from Russia, which represented only about 3% of U.S. imports in 2021 according to the U.S. Energy Information Administration, but Republicans and Democrats from the Pacific Northwest have different ideas about how to increase American energy independence.
Republicans argue the Biden administration should take steps to promote domestic oil and gas production. Rep. Cathy McMorris Rodgers , R-Wash., the top Republican on the House Energy and Commerce Committee, introduced a bill Feb. 28 that would boost U.S. fossil fuel production and approve the completion of the Keystone XL pipeline to carry Canadian oil to U.S. refineries, which Biden blocked on his first day in office.
“President Biden must restore American energy dominance and use energy resources to help Ukraine and Europe fight back,” McMorris Rodgers, who represents Eastern Washington, said on the House floor March 1. “We shouldn’t be buying a single barrel of oil from Russia and our allies shouldn’t be beholden to aggressors that attack their freedom.”
Democrats, meanwhile, have argued the best way long term for the U.S. to end its reliance on foreign oil is to transition the nation’s economy to lower-carbon energy sources and electric vehicles.
“The world community, unified in condemning the Russian invasion of democratic Ukraine, should now work together to meet immediate energy needs without the use of Russian oil,” Sen. Maria Cantwell, D-Wash., said in a statement. “I am hopeful that, longer term, this new international cooperation will enable us to accelerate our urgently needed transition to clean energy alternatives.”
Sen. Patty Murray, D-Wash., said in a statement Monday she was still considering proposals to ban imports of Russian oil, including a bill introduced March 3 by a bipartisan group of lawmakers, including Sen. Jon Tester, D-Mont.
“In the immediate term, increasing domestic oil and gas production should be on the table,” Murray said, “but it is clearer than ever why we need the landmark investment in clean energy and electrified transportation that we’re working to get to President Biden’s desk: transitioning to renewable, clean energy will help lower costs for families, cut carbon emissions, and strengthen our national security by promoting American energy independence.”
Congress and the White House can’t directly control U.S. oil and gas drilling, but their policies can influence the decisions of private companies to scale up production in response to favorable market conditions.
Dean Foreman, chief economist at the American Petroleum Institute, a trade association that represents the U.S. oil and gas industry, said while U.S. crude oil production has declined recently due to a complex set of factors, the Biden administration’s policies could affect domestic fossil fuel production in the long term.
“Seemingly long-term policies can affect investment today,” Foreman said in an email. “Hostile energy polices – including undermining pipeline infrastructure, an indefinite moratorium on leasing on federal lands, proposed higher taxes and a clean energy plan to eliminate natural gas in power generation – have not helped to stimulate investment, drilling and production needed to meet demand.”
Yet the Biden administration’s policies are not responsible for the current cost of gasoline – which on Monday hit a record high of $4.10 per gallon according to fuel price tracking company GasBuddy – said Samantha Gross, director of the Energy Security and Climate Initiative at the Brookings Institution, a nonpartisan think tank.
“Nothing that Biden has done has substantially changed the amount of oil and gas that the U.S. is producing over the last year,” Gross said. “Producers here will produce more, because the market is going to tell them to, and it’s not like President Biden tells them how much oil to produce – they go based on supply and demand conditions.”
While a ban on U.S. imports of Russian oil would have an effect on the market, industry analysts said it would be largely a symbolic move.
Ellen Wald, a senior fellow at the Global Energy Center of the Atlantic Council, a nonpartisan think tank, said U.S. refiners import crude oil from many different countries based on which sources are cheapest and most efficient. But while the United States imported an average of 199,000 barrels of crude oil per day from Russia in 2021, she said, that number fell to zero in the last week of February.
“A ‘ban’ would be a largely symbolic, political point at this point,” Wald wrote in an email, “since most refiners have already stopped importing Russian oil due to concerns over incurring penalties for violating financial sanctions, costs of insuring and transporting the oil, concern that cargoes could become banned mid transport, concern over accessibility and political and public sentiment.”
Patrick De Haan, head of petroleum analysis at GasBuddy, said while a ban on Russian oil imports could have some effect on prices, U.S. oil refiners already have limited ability to acquire Russian crude oil and the global oil market would eventually adapt to a unilateral U.S. import ban.
“Much of Russia’s oil supply has been de facto sanctioned via bank and shipping sanctions,” De Haan wrote in an email. “It could boost oil prices further, however, it might be marginalized by the fact that China would likely not adhere to our sanctions, and boost demand from China, limiting the potential price spike as a result.”
Rep. Dan Newhouse, a Central Washington Republican who cosponsored the bill to promote U.S. oil and gas production with McMorris Rodgers, said in a statement he supports an immediate ban on importing Russian oil not only to punish the Kremlin but also because the United States has tougher environmental regulations on oil and gas drilling than Russia does.
“The fate of the free world is at stake here, but it would be irresponsible of us to ban Russian oil imports without opening up domestic oil production,” Newhouse said. “As an added benefit, if we stop importing Russian oil and start producing more of our own here, we have the ability to decrease global emissions since we produce energy cleaner than any other country in the world.”
North Idaho Republican Rep. Russ Fulcher, R-Idaho said he supports terminating U.S. purchases of Russian oil and believes the higher prices Americans would pay at the pump would be temporary if U.S. production increases.
Gross said Biden has done a good job of “shooting the middle between the ‘drill, baby, drill’ people on the right and the ‘shut down fossil fuels now’ people on the left,” and the Ukraine crisis will test his administration’s ability to balance the short-term need for more oil production and the long-term need for lower-carbon energy sources.
“We need to bridge the gap between that short-term and long-term thinking, because they’re both right – they’re just based on different timeframes,” she said. “But politics has a hard time with nuance … and people hate high gasoline prices.”