Work in the Energy Industry? Why Not Vote for Oil and Gas?
Energy has been a particularly hot topic in the United States presidential election race this year. Disagreement over billions spent under the Obama administration on now famously-failed companies like Solyndra and A123 Systems (NASDAQ:AONE) punctuate the discourse across the board. Candidate Mitt Romney “likes coal,” while the Department of Energy loans money to Tesla Motors (NASDAQ:TSLA).
It is fair to say that billions of dollars have been poorly allocated in an attempt to revitalize a struggling economy and lend a competitive edge to a weak alternative energy market. The often criticized “picking winners” strategy, providing supply-side support for alternative energy companies, deserves to get beat up a bit. However, it’s also fair to say that there are actually thousands of new jobs out there that are a direct result of the stimulus. America pulls a growing 13 percent of its electricity from renewable sources. New tariffs against Chinese solar imports promise to help the American solar industry, and ongoing tax and fuel-cost incentives are putting more and more people into electric vehicles every year.
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That being said, it doesn’t take a genius to recognize that traditional energy — coal, gas, oil — is not going anywhere fast. Coal and gas combined account for 67 percent of the electricity produced in the united states. Even if the financial and political motivation were there, it would take years to unwind the infrastructure and investment in place — decades to disassemble one of the largest markets.
Longer, even, given the not-too-elusive nature of foreign energy markets. Massive economies like India and China are rapidly industrializing. Their demand for coal and oil — particularly in the short to mid-term — will rise. Coal stocks like James River Coal Company (NASDAQ:JRCC) and Arch Coal (NYSE:ACI) have seen large gains in the past few months as speculation mounts regarding a Romney presidency, growing demand overseas, and recovering natural gas prices.
Now, for the first time, oil and gas giants are directly involving themselves in energy politics at the grass-roots level. Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX), ConocoPhillips (NYSE:COP), British Petroleum (NYSE:BP), and Royal Dutch Shell (NYSE:RDSA)(NYSE:RDSB) together lead an industry that directly employs or directly affects some 9 million Americans, and they want to inform those people.
The companies are not vouching for one candidate or another — although Romney seems to be favorite. Support for energy independence and the expansion of exploration, drilling, and pipeline construction does not have to be a party issue. If you care about the economy, if you care about jobs, you should care about oil and gas. The companies are hiring speakers and organizers to hold small meetings across America to discuss the issues related to the oil and gas industry.
According to the Wall Street Journal, Marty Durbin, an official with the American Petroleum Institute, said, “We think that if people understand the issues, we’re going to get good policy in Washington.”
Jack Gerard, president of the API, said that when people understand the issues, they support the oil and gas industry initiatives two to one.
The initiative comes at a pretty pivotal time for the energy industry. The policy of the next four years could help determine the strategies that oil, gas, and coal companies pursue, and to a large part how successful they can be.