The Texas Energy crisis is global as short-sighted energy policies and green energy failures are causing a massive loss of oil and product supply as well as natural gas. Texas is still the heart of the global energy world and when it takes a hit the whole world feels it. Things are so bad that Texas has banned any Natural gas supplies leaving the state. That will cause problems for surrounding states and the rest of the world.

LNG exports from Texas will stop and that will have an impact on foreign spot markets. The heavily subsidized wind energy in Texas failed to bring down the grid and while some will tell you green energy is not to blame, well do not believe them. You cannot have an energy grid based upon the way things you may want them to be as opposed to reality. That lack of real vision and foresight may create a shock to the global economy unless they get things under control in Texas.

The overreliance on unreliable and less productive alternative energy sources like wind and solar could put the whole system at risk. While that can be part of the mix there are temptations to rely more on the unrulable. That is a major problem. We also have hope that the Biden Administration learns from this crisis and backs off its anti-fossil fuel agenda or the rest of our country will also be in the dark.

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 The ramifications will be felt at the gas pump where pump prices were rising weeks before this energy crisis. With almost 4 million barrels of U.S. oil production shut-in and refineries shutting down so people can have natural gas heat in their homes and not freeze to death will cause big drops in distillate and gasoline supply. Crude supplies have been falling for weeks as well and last night the American Petroleum Institute (API) reported that U.S. Crude Supply fell by 5.8 million barrels last week. Distillate stocks fell by 3.5 million barrels, but gas stocks increased by 3.9 million barrels. Part of the crude draw was a major 3.0 million barrels drop at the Cushing delivery hub.

Oil prices dipped after the Saudis singled that they would reverse their 1 million barrel a day production cut in April. That is good because the market will need that oil to offset the losses from U.S. oil output. I remember we used to poke fun at Iran because, despite the fact they sat on some of the most prolific oil reserves in the world, they failed to build a refinery and had gasoline and diesel shortages because they had to import those products. I am sure some in the world are looking at the Texas energy mess and scratching their heads.

While Texas speeds this energy price spike up, it was something I warned was coming. Rash predictions about permanent demand destruction after Covid 19 and predictions of “peak oil demand” have us seriously underinvested not only in the short run but in the long run. The rush towards the electrification of cars and everything else must be balanced with the fact that electricity does not grow on trees. Believe me, the answers are not blowing in the wind. Wind Turbines cannot be scaled up enough and are unreliable at times. Not to mention a personal opinion, kind of ugly ads they scar the landscape is some of our beautiful areas of the country. Solar of course is also less reliable and there has to be a massive improvement in storage to do solar on a large scale. That of course will take millions and millions of batteries and we will have to scour the globe for Lithium, nickel and cobalt, silver.

They say we fought wars over oil. I am afraid we might have to fight wars for ‘rare earth minerals”. China one of the world's biggest supplies of rare earth minerals has already signaled they may hoard supply. Those that push for all-electric everything may want to take into account those types of risks. What part of the rare part or rare earth minerals do they not get?

Mother nature needs to save us. Natural gas prices are now soaring, and propane cash prices are rocketing.