The Biden Administration must not understand the situation in the Ukraine if they don't believe building the Keystone Pipeline is important. On multiple occasions the Biden Administration has said no to reversing position on the Keystone Pipeline as a way to help reduce reliance on Russian oil. They don't recognize that approving the pipeline provides both short term and long term value to the situation in the Ukraine. Joe Biden, and the people around him, are so wedded to the Green New Deal that they are yielding an important tool they can use against Vladimir Putin.
In response to a question about approving the Keystone Pipeline, Jen Psaki, President Biden's spokesperson, said "It would take years for that to have any impact."* Pete Buttigieg, Biden's Secretary of Transportation, said the President does not want to implement "permanent solutions" to "short term problems," when asked if the Administration would approve the Keystone Pipeline in light of the Russian invasion of the Ukraine.** President Biden and his team just don't get it.
Approving the Keystone pipeline should have an immediate impact on oil prices. Its true the pipeline isn't built yet, so oil won't flow immediately but oil prices aren't just based on supply. Oil is sold on the Commodities market. Companies are placing orders for oil to be delivered in the future and those prices can change not just based on actual supplies but on perceptions. For example, Russian oil supplies have not yet been banned but oil prices have risen significantly in anticipation that there will be an interruption.
Announcing a significant new source of oil or gas coming onto the market, whether it be new leases to drill or the Keystone Pipeline, would tell the market that a replacement for Russian oil is not a wish and not dependent upon OPEC stepping in, not dependent upon Iran or Venezuela. Prices won't immediately drop to $40 per barrel, but people buying future oil will either bid less or buy less in anticipation of greater supplies when the American oil hits the market. The immediate good news should cause prices to stabilize and then mitigate against further price increases.
The other immediate benefit is the message it sends to Vladimir Putin and the Russian Oligarchs. Approving the Keystone Pipeline would tell Putin that if he stays in the Ukraine, the US is going to replace his biggest source of revenue and leverage over other countries. Right now, it appears the US is negotiating with Iran and Venezuela for increased oil production and neither of those is a long term solution or a threat to Russia's leverage.
Which leads to the bigger point - we're not facing a short term problem. Worst case scenario, Russia conquers the Ukraine, as they will if they have the stomach for it. Is the world going to just going to say "well we tried to stop them" and pull all the sanctions? Not likely. That means restrictions on Russia, impediments to purchasing Russian oil, will be in place for a long time.
Even if the Russians don't succeed in the Ukraine, we still have a long term problem because we still have Putin in charge of Russia and Russian oil will give him a source of revenue to rebuild and re-arm while still having leverage over the European countries. Do we want to leave that as the status quo?
Weaning America and other countries off dependence on oil is a lofty idea. But it's not a solution to the crisis we face both now and for the next few years. We'll probably have people on Mars before we sufficiently reduce dependency on oil. Drill baby drill is really the solution that best serves the American people and the world in both the short and long term.
* https://www.whitehouse.gov/briefing-room/press-briefings/2022/03/03/press-briefing-by-press-secretary-jen-psaki-march-3rd-2022/
** https://dailycaller.com/2022/03/03/galloping-permanent-solutions-buttigieg-biden-admin-keystone-pipeline/
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