Mapping The Escher-like Landscape Of United States Fossil Fuel Sanctions
How Since 2009 The US Has Combined Oil & Natural Gas Fracking, With Economic & Military War, To Control Global Fossil Fuel Access & Prices, And How That Control Is Now Slipping Away
The Role Of Fracking In US Oil & Natural Gas Production
On the surface, the dynamics of US sanctions and other US manipulations of both the supply and price of oil and natural gas, may seem self contradictory.
Misperceptions arise when observers make the key mistaken assumption that manipulation of oil and natural gas supply, and connected fossil fuel prices, is for the simple, cynical purpose of the US profiting from its own domestic oil and gas production - production which is now largely (and strangely) derived from prohibitively expensive fracking (hydraulic fracturing) and other coal/oil shale and tar sands extraction.
Here are charts showing that by 2015, near the exit of the Obama administration, fracking had become the primary source of US fossil fuel production. (During his presidency, Barack Obama expanded US fossil fuel production more than any other president in US history, before or since.)
It's Not About the Profit
A closer look at the economics of US fracking policy shows that mere profit is not the objective. Fracking, shale, and tar sands fossil fuel extraction do not make money, they lose money. The cost of extracting these exotic resources (both in dollars and in energy input) exceeds the dollar revenue and the energy output from selling and using them. Here (below the photo) is the link to a Keiser Report exposé on the economics of fracking which shows that fracking is based on unsustainable debt funding (backed by US bailouts of bankrupt fracking operations).
Keiser Report: Frackers Scrounging for More Debt
http://kazan2024-en.rt.com/shows/keiser-report/464439-frackers-debt-companies-production
Why Fracking & Sanctions?
So if US fossil fuel policies do not hinge on profit making, then what are they designed for? For example, shortly after declaring its 2022 sanctions against Russian oil and natural gas production (seemingly to both punish Russia for its Ukraine intervention and make US fracked gas and oil dominant in the market) why did the Biden administration almost immediately scramble to make a deal with President Nicolas Maduro to increase Venezuelan oil output? After all, the US had been exacting similar draconian fossil fuel sanctions on Venezuela for years. Why the sudden turn about?
Maintaining Global Hegemony, By Controlling Fossil Fuels & Their Prices
The answer boils down to the Obama, Biden, and Trump administrations manipulating to economically undermine the fossil fuel profits of nations like Russia, Venezuela and Iran, and in doing so, torpedo their efforts to end the US domination of global geopolitics.
The game is global power and economic dynamics. The Obama administration saw early on, that Venezuela was leading a South America-wide rejection of historical US control over that continent. Since the 1998 election of Hugo Chávez as its president, Venezuela had been directly using its oil wealth to support resistance in multiple countries that were rising up against the US.
The Obama, Biden and Trump administrations have watched as Russia, China, Iran, India, South Africa, Brazil, Syria, Libya, and others, have coordinated to challenge the US globally, making moves to escape the worldwide US petro-dollar currency system, and replace it with a new global system of exchange that is free of US domination. At the same time Russia, China, Iran and other nations have also been working to build new pipelines which circumvent US control of oil and natural gas transport. And China is concurrently developing new trade relations and trade transit routes with other nations all over the world to undermine legacy US colonial domination of global economic exchange.
(These powerful multinational efforts portend an end to the global US empire, and are key triggers of US proxy conflicts with Russia in former USSR republics like Ukraine, Georgia, and Kazakhstan. And they motivate other ongoing US regime change wars and manipulations in Venezuela and Iran, as well as in and around China, including color revolution instigations in Hong Kong, Taiwan, Xinjiang, Tibet, Myanmar, Bangladesh, Nepal, Indonesia, the Philippines, Timor‑Leste, and Sri Lanka.)
See multiple reference links below laying out strategies by the global South and East to work around global US dominance, and covering other geopolitical dynamics noted in this essay.
The World Lever of Fracking
Archimedes once stated confidently "Give me a lever long enough and a fulcrum on which to place it, and I shall move the world."
The Obama administration discovered its world-moving lever, in the technology of fracking.
Because of the global power dynamics noted above, the Obama administration, under the leadership of Secretary of State Hillary Clinton, massively subsidized North American oil and natural gas fracking, and tar sands oil extraction. (As noted above, all of these mining and drilling methods inherently lose money and so don't make economic sense without subsidies and periodic economic bailouts.)
Secretary of State Clinton eventually expanded fracking far beyond the boundaries of North America to create the incredibly destructive, and climate threatening, global fracking industry that we know today. And she established the US as that industry's leading bull.
How Obama Used Fracking To Undermine Russia & Venezuela
The US then used its fracking dominance to flood global fossil fuel markets with fracked natural gas and oil, and this triggered the prices of gas and oil to plummet so low that both the Russian economy, and especially the Venezuelan economy, went into downward tailspins. In turn, this pulled the rug out from under efforts of Russia and Venezuela to challenge the US on the global stage.
With this historical context in mind, the many US wars, proxy wars, and coup operations in areas key to fossil fuel production, control, and pipeline transport, are no surprise. Pretzel-like US fossil fuel sanction regimes come into focus, and make a lot more sense. The US is carefully balancing the results of its pulls, on the world lever.
Ukraine, Russia, Venezuela, Iran Sanctions Merry-Go-Round
This returns us to examine full circle, the outright comical US sanction acrobatics around Ukraine, Russia, Venezuela and Iran. Ironically, Biden and Trump administration sanctions and attacks on Russian, Venezuelan and Iranian fossil fuel production since 2022 have dramatically raised global oil and natural gas prices by shrinking supply. Such price rises of course benefit Russia, Venezuela, and Iran (who can then find higher paying alternative customers in partnering nations like China and India). This in turn enables Russia, Venezuela and Iran to spend their newly increased oil and gas wealth to again ramp up their active opposition to US world dominance - a perfect Catch 22 quandary for the US.
On top of this (as we are seeing now in the midst of the ill conceived US war on Iran) if oil and natural gas prices rise too precipitously, this results in skyrocketing fuel price inflation at home that deeply harms the neoliberal West's own economies.
The US Goes Begging
So, seeking to avoid all of these bad outcomes, in early March 2022, right after announcing sanctions to block Russian fossil fuel sales, the Biden administration almost immediately fell into begging Venezuela and Saudi Arabia to increase their fossil fuel outputs in order to stabilize global oil prices at lower levels. Unfortunately for the US, Venezuela and Saudi Arabia refused.
And now we are seeing the even more comical contortions of the Trump administration, as right in the middle of US wars for global dominance in both Ukraine and Iran, Trump hilariously just dropped oil and gas sanctions against both Russia and Iran, because if the US didn’t waive those sanctions, the global supply of fossil fuels would decline so drastically that oil, natural gas and gasoline prices would double and send the entire global economy into a massive collapse that would rival The Great Depression.
It's all just another day in the life of an empire, that Escher and Archimedes could only have imagined in their dreams.
References
Forbes: Graph showing dramatic increase of US oil production under Barack Obama
(This upward trend has continued under both Biden and Trump.)
Fossil Fuel Industry Subsidized at Rate of $11 Million per Minute
https://projectcensored.org/1-fossil-fuel-industry-subsidized-at-rate-of-11-million-per-minute
Venezuela's Oil Wealth and Social Transformation ~ Dario Azzellini
http://www.azzellini.net/en/buchbeitraege/venezuelas-oil-wealth-and-social-transformation
21st Century South/Central/Caribbean American Coordination vs US Empire - Bolivarianism vs Monroism
https://venezuelanalysis.com/images/15485
BRICS (Brazil, Russia, India, China and South Africa) New Development Bank Threatens Hegemony Of U.S. Dollar (Forbes, 2014)
https://forbes.com/sites/realspin/2014/12/22/brics-new-development-bank-threatens-hegemony-of-u-s-dollar/?sh=701318977f89
Russia-led Eurasia Economic Union & China agree to financial & monetary system to bypass dollar transactions (Pepe Escobar, 2022)
https://new.thecradle.co/articles/say-hello-to-russian-gold-and-chinese-petroyuan
After Russian, US eases sanctions on Iranian oil
https://timesofindia.indiatimes.com/business/international-business/bring-almost-140-mn-barrels-to-global-markets-after-russian-us-waives-sanctions-on-iranian-oil/articleshow/129711926.cms
Russian oil exports to India surge as Europe shuns cargoes: Delhi maintains close trading ties with Moscow despite western sanctions
https://ft.com/content/5efc6338-3f01-4015-aedf-53a4a1944ca8
Friends in Need: Geopolitics of China-Russia Energy Relations ~ Felix K. Chang (Includes descriptions of new pipeline routes.)
https://fpri.org/article/2014/05/friends-in-need-geopolitics-of-china-russia-energy-relations
Iran-Pakistan Pipeline: The “Peace Pipeline”
https://www.gem.wiki/Iran-Pakistan_Pipeline
Chatham House: What is China’s Belt and Road Initiative (BRI)?
https://chathamhouse.org/2021/09/what-chinas-belt-and-road-initiative-bri
National Geographic (Fracking): How Hydraulic Fracturing Works
https://education.nationalgeographic.org/resource/how-hydraulic-fracturing-works
Note: An earlier version of this article appeared in March 2022. The article has been updated to include implications of the 2026 US/Israel war on Iran.
—
Eric Brooks is a full time grassroots organizer specializing in the interplay of global capitalist economics and war, with energy policy, the climate and extinction crisis, and environmental justice.