Oil prices have soared to multi-year highs as a result of Russia’s invasion of Ukraine, as governments apply sanctions and banks refuse to do business with the country.
Elon Musk, the CEO of Tesla, turned to Twitter to demand an urgent rise in oil and gas production in the United States and throughout the globe to compensate for Russia’s lower output.
“Hate to tell it, but we need to expand oil & gas production urgently,” Musk stated on Twitter. “Extraordinary circumstances need extraordinary responses.”
Musk also said that the acceptance and production of renewable energy would not happen overnight. “Obviously, this would hurt Tesla,” he said on Twitter, “but sustainable energy alternatives just cannot respond quickly enough to compensate for Russian oil and gas exports.”
According to the New York Times, Russia produces one out of every ten barrels of oil used worldwide, making it the world’s third-largest oil producer.
Oil prices soared to multi-year highs on Friday, as buyers spurned supplies from Russia, the world’s second-largest crude oil supplier.
Crude oil prices have risen for the first time since the middle of 2020. The market’s most actively traded oil futures finished at highs not seen since 2013 and the 2008 financial crisis, respectively.
According to Bloomberg, Elon Musk’s statements come as the Biden administration considers a ban on Russian crude oil imports. The US government has previously said that restricting energy imports served no strategic purpose for the nation. However, US oil sector officials have suddenly come out in favor of increasing output and halting imports from Russia.
Sens. Joe Manchin (D-WVa.) and Lisa Murkowski (R-Alaska) introduced legislation on Thursday to prohibit Russian energy imports.
According to The Hill, Manchin stated on Thursday that “the United States has the capacity to backfill and support all of our partners around the globe as they [Russia] utilize this energy as a weapon.” “We must ensure that we are doing our part [in terms of energy generation].
Nobody does it better than us. We accomplish it in a more efficient manner than anybody else. And, thanks to a reserve, we can accomplish a lot more during this crisis.”
White House press secretary Jen Psaki said on Friday that the administration is considering ways to reduce Russian oil imports while keeping prices low.
“We are looking at measures right now to reduce U.S. use of Russian energy,” Psaki said, “but we are extremely focused on reducing the effect on families.” “If you decrease supply in the global economy, gas prices will rise.”
Despite the White House’s concerns, several senators have stated their support for a Russian oil embargo.
House Speaker Nancy Pelosi stated of a ban on Russian oil, ” “That is something I am all for – outlaw it. Russia’s oil should be banned.”
“America is subsidizing Russia’s war by purchasing Russian oil and gas rather than generating our own,” said Rep. Lauren Boebert, R-Colorado, in a tweet.
Hate to say it, but we need to increase oil & gas output immediately.
Extraordinary times demand extraordinary measures.
— Elon Musk (@elonmusk) March 5, 2022
Within 30 minutes after posting, Musk’s tweet had almost 20,000 retweets. Many industry executives have endorsed his viewpoint.