June 19, 2024
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Our view: Oil price crash cause for celebration on Earth Day

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As we approach the 50th anniversary of Earth Day, the Crown Prince of Saudi Arabia and Russian President Vladimir Putin have done what 50 years of protests could not accomplish.

Their ill-timed decision to launch a price war has made it more economical to leave oil in the ground than to drill for it anywhere in the world. The stunning collapse of oil prices — futures traded briefly below zero before rebounding — will have far-reaching consequences.

On the Central Coast, where protests against a devastating oil spill off the Santa Barbara coast helped sparked the first Earth Day festivities, there will be virtual celebrations as calls to action move to social media.

The latest Gallup survey reports that more than 75 percent of  U.S. households are now recycling, using less energy and using disposable bags. But the number of Americans who say that the environmental movement has done more good than harm is around 66 percent versus 76 percent in the early 1990s.

Of course, the cause of collapsing demand for oil and the virtual celebrations is the same thing — the coronavirus pandemic that has brought economic activity to a screeching halt. The foolish moves of Putin and Muhammed Bin Salman created so much supply that it costs more to store oil than the product is worth.

Collapsing oil prices aren’t necessarily good for the environmental movement. Cheap gas will make alternative energy and battery-powered vehicles less competitive. Plunging oil-related tax revenue will make it harder for the left-leaning cities and counties on the Central Coast to balance their books.

Beyond that, what’s changed since the earliest days of Earth Day is that America is the world’s largest oil producer, the so-called swing producer that, until the Saudi-Russian price war, had the greatest influence over prices.

Perhaps the silver lining in this Earth Day would be if the Trump administration, which has been rolling back environmental regulations, dropped its plans for drilling in wilderness areas and off the coasts in the name of reining in production, if not environmentalism. That would be a real reason to celebrate Earth Day.