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Congresswoman Alexandria Ocasio-Cortez rejoiced at the news that U.S crude oil prices had dropped into negative territory earlier this week, tweeting “You absolutely love to see it.”
In the tweet, which she later deleted, Ocasio-Cortez also wrote: “This along with record low interest rates means it’s the right time for a worker-led, mass investment in green infrastructure to save our planet.”
Ocasio-Cortez is perhaps the most vocal opponent of the U.S. oil industry in Congress, along with Bernie Sanders, and she was also the author of a Green New Deal that envisaged a shift to a completely renewable energy future.
Some analysts have estimated that this shift would cost tens of trillions of dollars.
Oil prices turned negative yesterday, with West Texas Intermediate falling below minus $37 a barrel as traders scrambled to ditch their May delivery oil contracts to avoid actual delivery that would have come at a steep cost as free storage space shrinks.
However, Ocasio-Cortez’s joy at this price development may be both ill-timed and misguided. As Senator Ted Cruz tweeted in response, “Which part of the millions of blue-collar workers losing their jobs & small refineries closing their doors forever is what you ‘love to see’ (per your deleted tweet) @AOC? Asking for those in Texas & across USA whose livelihoods (ability to put food on the table) are AT RISK.”
But job loss aside, Congresswoman Ocasio-Cortez appears to be confused about the relationship between the fossil fuel industry and the renewable energy industry. The nature of this relationship is striking: when oil is cheap, renewable energy reaps no benefits because consumption of the cheap commodity increases.
Granted, right now, we are in a unique situation when oil is cheap because there is no demand for it and the supply is too high. However, demand for electricity, including from renewable sources, is also down because of the lockdowns. Solar and wind industry representatives even warned of massive job losses in their industry because of the pandemic. In other words, the renewable energy industry is also in trouble—it’s not just bad old oil. And this trouble, along with the 22 million workers that lost their jobs over than last four weeks alone, will make her mass green investment vision particularly challenging to materialize.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.