By WAYNE DELUCA
On Monday, April 20, prices of crude oil futures effectively turned negative. Demand for oil has gone so low that it is more expensive to find places to store it than it is worth to sell it. Oil insiders have forecast that hundreds, or even thousands, of companies could go bankrupt, and find that their assets are not even worth keeping around. It couldn’t happen to a more deserving industry.
For decades, the United States has favored brutal authoritarian regimes and toppled governments in order to ensure continuous access to oil. The poster child for its support is the Kingdom of Saudi Arabia, which by any measure is one of the most tyrannical governments in the world, but has been consistently tolerated because of its proven oil reserves and its cooperation with imperialist energy corporations.
The 1953 coup that overthrew Mohammad Mosaddegh, the democratically elected president of Iran, came because Mosaddegh’s plans would have meant the nationalization of oil. The Shah, a known puppet of the United States, oversaw a notoriously brutal state for the next 26 years—until he was overthrown in the 1979 revolution.
Those who took part in the movement against the 2003 war in Iraq well remember the slogan of the time—“No Blood for Oil.” Iraq’s position atop a massive oil reserve made it a strategic target of George W. Bush’s fake “war on terror” even though Saddam Hussein’s regime had nothing to do with the terror attacks of Sept. 11, 2001, and alleged evidence of nuclear, biological and chemical weapons programs turned out to be all fake.
In Venezuela, where first Hugo Chávez and now Nicolás Maduro have attempted to use the country’s oil revenues for social programs, the United States has supported numerous coups and coup attempts. In 2002, a brief coup had ousted Chávez but was reversed under massive popular pressure. Since early 2019, the United States has recognized self-proclaimed “President” Juan Guaidó in place of Maduro and made several attempts to destabilize the country. Sanctions and embargoes are ongoing even during the coronavirus emergency. All of this is meant to discipline Venezuela as an oil-producing country.
The oil industry has long been an egregious and unrepentant polluter. The oil spill at the Deepwater Horizon, which pumped crude into the Gulf of Mexico for 87 days in 2010, remains one of its most notorious disasters. They have pushed for pipelines to move oil across the land as well, digging through watersheds and threatening spills like that in North Dakota in November 2019, when 9000 barrels leaked from part of the Keystone pipeline system. These have often crossed Indigenous territories and drawn sharp resistance, such as the 2016 protests at Standing Rock against the Dakota Access Pipeline led by the Oceti Sakowin people.
In the United States, under the farcical goal of energy independence, the oil industry is subsidized to the tune of $16 billion per year. The European Union pays its oil companies considerably more. In return, these corporations fund the industry of climate denialists, who spread misinformation about the effects of greenhouse gases. During a planetary emergency, this makes the oil industry especially toxic.
Petroleum accounts for about 40% of carbon emissions in the United States. Given the current targets for avoiding the worst effects of climate change, it is clear that we will need to burn dramatically less of it by 2030, and effectively none by 2050. The most effective way to do this is to let the current crisis destroy much of the oil industry.
The oil industry’s current invested capital and infrastructure, and its influence in the government, have already moved Donald Trump to make pledges to save the industry. But socialists and environmentalists need to oppose such maneuvers. If the oil companies and their assets are liquidated in bankruptcy, one of the major obstacles to a clean energy transition will disappear. We should begin with the demand: Not one penny for the oil companies!
In their place, as soon as it is safe to return to work, we could begin a transition to mass transit infrastructure. Millions of people—in unprecedented, record numbers—have filed for unemployment. Many of them could be put to work straightaway, building light and heavy rail systems that could replace a great deal of our current reliance on oil to transport people and goods around the country.
Meanwhile, those formerly employed in the oil industry could be gainfully employed in the energy industry, building and placing renewable energy infrastructure. The revenues from oil bankruptcies could even be sequestered to fund the transition. And all workers must be guaranteed a living wage and the right to form unions.
Such a program could be a start on a wholesale transformation of the economy. We need not only to stop extracting and burning oil but to reorient the whole process of production and distribution toward meeting human needs, rather than making private profit. A sustainable system cannot be built on the assumptions of accumulation of capital, which must inevitably treat the natural world as a source of values to be extracted. It must be based on an ecological socialism that treats it instead as irreplaceable and a value in itself.
The oil industry is in crisis, and for the vast majority of humanity that is a good thing. We should take this opportunity to create a future where it is only a distant and quaint memory.