Russia Seeks to Stop America’s Booming Energy Industry

July 2017, Vol. 244, No. 7

By Pipeline & Gas Journal Editor Jeff Share

The next time Secretary of State Rex Tillerson visits President Putin in the Kremlin, he should ask his former buddy something that’s bothered me for years: what are the Russians up to in attempting to sabotage our energy industry?

First, let’s understand that energy has always been used as a political tool, even by Washington. During the mid-1980s, at the request of President Reagan, the Saudis ramped up their oil production to over 10 million barrels per day, causing the price to crash to below $10. The singular goal was to wreck the already tottering Soviet economy, which has always been dependent on oil revenues.

Reagan’s plan worked as the Evil Empire did indeed implode, the result being that it could no longer subsidize the energy needs of its satellite states. Of course, it also crushed our domestic industry, destabilized the energy-producing states,  and led to the banking crises of the late 1980s that began in Texas and spread nationwide.

My involvement with the energy industry began in 1990 and I watched another nasty cycle cripple the domestic industry later in the decade. By then I decided OPEC was trying to kill off our industry by financially backing anti-fossil fuel organizations.

But let’s talk about now. A recent article in Newsweek headlined, Intelligence: Putin is Funding the Anti-Fracking Campaign, stated that “Recent intelligence reports show that Russia is interested in influencing more than just America’s elections. Russian President Vladimir Putin and his cronies have taken aim at undermining the U.S. energy industry as well.”

The article said that within the U.S. intelligence community’s report describing Russian activities in the 2016 presidential election,  there is “clear evidence that the Kremlin is financing and choreographing anti-fracking propaganda in the United States.” By targeting fracking, Putin hopes to increase oil and gas prices, destabilize the U.S. economy and threaten America’s energy independence, Johnson writes.

Fracking has led to one of the great economic and industrial revolutions in recent history, and as Johnson notes, generates a half-trillion dollars in economic benefit to the U.S. annually with its support of 4.3 million jobs. In fact, by 2020, the U.S. is on track to produce over 1.5 billion barrels of oil annually, over half of the total U.S. output.

The result has reduced America’s imports and cost OPEC and Russia their once-enormous clout on the world market. The Russians are just as concerned about the huge growth of U.S. natural gas production, which the report says, creates “potential challenges” for the profitability of Gazprom.

Russia has been responding via RT, the government-controlled global propaganda outlet, by airing what Johnson describes as a “slew” of dubious attacks against fracking, including a discredited anti-fracking documentary that it airs worldwide in addition to 62 different anti-fracking TV stories.

This is not a new tact for the Russians, says Johnson, a senior fellow at the Taxpayers Protection Alliance, a nonpartisan think tank that says it is “dedicated to a smaller more responsible government.” In 2014, intelligence information led then-NATO Secretary General Anders Fogh Rasmussen to conclude that Moscow conspired with environmental groups to block fracking activities in Romania, Bulgaria and Lithuania.  “Russia, as part of their sophisticated information and disinformation operations, engaged actively with so-called non-governmental – environmental organizations working against shale gas – to maintain dependence on imported Russian gas.”

Johnson says a U.S. Senate report found that the Sea Change Foundation funneled over $43 million to environmental causes in 2011 – “padding the budgets of ardent anti-fracking organizations like the Sierra Club, the League of Conservation Voters and the National Resources Defense Council.” The Foundation, he says, is heavily funded by a Bermuda-based shell corporation with direct ties to Putin and Russian oil interests, and was indicted for offshore money laundering.

“It seems the only folks left attacking fracking are puppets of the anti-science, anti-American Russian propaganda machine. These people hope that lies about fracking can weaken the United States, dry up the supply of oil and gas, drive up energy costs and force European countries to pour money into Putin’s coffers. As the U.S. intelligence report proves, Russia is willing to go to great lengths to destroy America’s fracking industry. But the United States should stand firm against this threat. The battle over fracking is one fight America can’t afford to lose.”

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