Fact check: Will Biden's Alaska energy fiasco cripple the US economy even more?

In a recent article featured on Revolver News, a speculation of impending economic catastrophe was afforded regarding a handful of separate events consisting of the recent bankruptcy of a trucking company, oil drilling coming to an end in Alaska on federal land, and the Biden administration’s move to having natural gas no longer being transported by train.

While the aforementioned circumstances could certainly have some disparate unfavorable economic impacts, the resounding message hammered in the piece suggests that natural gas will reach prices potentially unseen in the near future.

But is that a bonafide possibility? Well, let’s examine the claims and dig into the nuance to get a better understanding.

First and foremost, the sky-is-falling flavor of speculation featured in the article didn’t come directly from the author of the article, but rather from the conjecture of a random Twitter user who goes by the name Wendy Patterson.



Upon first glance at Patterson’s profile on Twitter, one might get coaxed into thinking she’s a notable personality due to her harboring just over 80K followers on the platform.

But for the social media savvy, or just those who’re generally observant, it’s hard to miss that she’s also following 47K accounts as of September 2023, which typically serves as a clue that someone attained their large social media following using the follow-for-follow (F4F) method.

But aside from acknowledging the eyebrow raising ostensible ruse of Patterson’s social media following, what’s most important to address are the claims she made about the doom-and-gloom set to befall the American economy. We’ll examine each assertion, ascertain if it’s true, and whether the speculated impact is feasible.
 
  1. “Biden canceled all of the Alaska drilling on Federal land.  At the same time he stopped allowing liquid natural gas from being transported by train.”
Regarding the end to drilling on federal land, that’s a half-truth. The Biden administration did announce an end to all oil drilling leases in Alaska’s Arctic National Wildlife Refuge earlier in September, but the Biden administration also greenlit the Willow project this past March within the same state, much to the dismay of environmentalists and anti-fossil fuel outfits.

As for the Biden administration cutting off the transportation of natural gas by rail, that is absolutely true. However, Alaska isn’t accessible to the contiguous U.S. by rail, and the use of trains to transport natural gas wasn’t even a thing in modern times until the Trump administration greenlit the practice in December of 2020.

Basically, the cost benefits of the Trump-era policy of gas-by-rail enacted in the final weeks of his time in office weren’t exactly realized, so this may have a negligible impact on natural gas prices.

Thus, onto the next claim by Patterson:
 
  1. “That leaves the only mode of transportation by trucking.  About 2 months ago the largest trucking company went out of business: Yellow, one of the nation's largest freight and trucking companies, announced it is shutting down, leading to one of the largest mass layoffs in recent history and potential shipping cost increases. The company is in bankruptcy just three years after getting a $700 million loan from taxpayers. So that is going to create a massive supply chain issue of liquid natural gas which means your utility bills as well as the price of gas is going to skyrocket.”
So, in this claim by Patterson, she is about half right. Yes, the transportation company Yellow did declare bankruptcy in early August after years of financial struggles and taking on a pandemic-era loan of $700 million.

However, Yellow is not “the largest trucking company,” but rather the third largest less-than-truckload (LTL) freight carrier. The LTL distinction is somewhat of a big deal in terms of the proposed theory Patterson is asserting about impacting natural gas costs due to disrupted supply chain issues, namely that Yellow wasn’t the type of freight company hauling natural gas.

LTL shipping consists of trucks hauling an amalgamation of small freight shipments headed for different destinations, a.k.a., shipments akin to maybe a small business only needing a pallet or two of various product rather than a than being a truck dedicated to crude oil or natural gas.

Transportation companies modeled as an LTL aren’t in the natural gas business, as the vehicle and hauling specs are completely different for transporting gas and require a special (and dedicated) storage tank.

In short, Patterson’s claims that Yellow filing bankruptcy will result in an adverse impact on the cost of natural gas is unfounded, nor will the bankruptcy disrupt the supply chain of such natural gas (although the company shutting down will likely be unpleasant for the roughly 30,000 employees).

Again, this conclusion shouldn’t be too surprising because while Patterson may be a wonderful person, she’s not exactly an expert (or even casual enthusiast) regarding things like freight and logistics.
 
  1. “Biden used 300 million gallons of gas from our reserves to keep the gas prices artificially low.  They can't do that anymore.  They have set us up in every way to purposely make gas prices and utility prices skyrocket so fill all of your gas cans, buy propane ect NOW while you can still afford it.”
This is another area where Patterson got it wrong, as she actually underestimated the losses to the strategic reserves and also confused crude oil with produced gasoline.

The Biden administration didn’t deplete 300 million gallons of gas from our reserves, he depleted approximately 300 million barrels of crude oil – which translates to 12.6 billion gallons of crude oil which would render roughly six billion gallons of gasoline.

The tapping into the reserves did alleviate gas prices when the Biden administration first kicked the effort off in late 2021, but Energy Secretary Jennifer Granholm is aware of the 40-year low of the Strategic Petroleum Reserve (SPR) and has acknowledged that the federal government is working to replenish the used stock.

So, the emergency sales of the SPR coming to a stop will likely result in some increased gas prices, but to what degree that will be is anyone’s guess. However, it can be said with certainty that gasoline will not suddenly become $30 a gallon (another lucrative prediction made by Patterson in the same exact thread).



Furthermore, as if a non-notable Twitter user claiming gas is going to be $30 a gallon isn’t enough evidence that the vector may not know what they’re talking about, buying the likes of gas cans and filling them up would be pretty silly considering five-gallon cans by themselves cost about $20 and gas sitting in a can has a shelf life of three to six months.
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The opinions reflected in this article are not necessarily the opinions of LET
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