Now is the perfect time for US energy producers to step up if Europe cuts its reliance on Russia, Ci
- Citadel CEO Kenneth Griffin wrote in the WSJ that Europe should end its reliance on Russian energy.
- He said the US can help its European allies by increasing oil production.
- Russia is one of the largest natural gas producers in the world, which gives it leverage over Europe.
Russia's oil and gas industry largely funds its military, which invaded Ukraine early on Thursday. The founder of a major US hedge fund says that's why now is the time for Europe to stop buying Russian oil — and the US can help.
Kenneth Griffin, founder and CEO of Citadel — a multinational hedge fund and financial services company — was one of many world leaders, lawmakers, and executives to denounce Russian President Vladimir Putin's actions in Ukraine. Griffin wrote an opinion piece in the Wall Street Journal on Wednesday, along with Stanford's Hoover Institution senior fellow Niall Ferguson, that expressed support for the US to encourage its European allies to rely less on Russian energy.
According to the Energy Department, Russia is the second-biggest producer of natural gas, behind the US. Griffin and Ferguson explained Russia's prominence in the energy sector is largely due to European customers. customers. They write that if the US increased fracking — a move President Biden would seem to oppose — it could relieve Europe's dependence on Russia, therefor cutting off some of its world power.
"Without Russian energy, European citizens would struggle to get through winter. Mr. Putin has long understood the leverage this gives him," they wrote. "The U.S. should encourage its European allies to reduce their reliance on Russian gas exports."
Ferguson and Griffin added that reducing that reliance would require "substantial investment and political will," and they suggested that the US should produce more gas because it is "a relatively clean-burning fuel that the world will need for decades."
"Bans on fracking are misguided and neutralize a critical economic and geopolitical advantage," they wrote. "The U.S. should frack more, so it has the gas needed to wean Europe off Russian pipelines."
During his presidential campaign, Biden pledged to ban fracking, which is drilling into the earth to procure resources like oil and natural gas. Climate activists supported Biden's pledge due to fracking's exacerbation of the climate crisis by releasing fossil fuels, but since he took office, Biden has not yet fulfilled that pledge, and he even called on the Organization of the Petroleum Exporting Countries (OPEC), which manages oil supply for 13 countries, to increase oil production in August.
And regardless of whether the US does increase oil production to aid Europe, decreased reliance on Russian energy is already in the works. German Chancellor Olaf Scholz recently suspended the Nord Stream 2 gas pipeline between Russia and Germany, following Biden's Wednesday announcement that he would impose sanctions on the pipeline.
Griffin and Ferguson believe the US can take the next step and put an end to that reliance altogether.
"Today American energy can end Berlin's dependence on Russia," they wrote, referencing the US airlifting food into western Germany when Soviets blockaded Berlin in 1948. "If planeloads of food can get the better of Stalin, boatloads of gas can get the better of Mr. Putin."
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