Nationalization of oil is key to stop climate change

Even as Vladimir Putin’s barbaric invasion of Ukraine proceeds and concerns over the subsequent high gas prices proliferate, we cannot forget that the climate crisis remains a dire emergency. The latest report of the U.N.’s Intergovernmental Panel on Climate Change (IPCC)—the most authoritative source on climate change research—could not be more explicit in reaching this conclusion. U.N. Secretary General António Guterres described the report as a “file of shame, cataloguing the empty pledges that put us firmly on track towards an unlivable world.” This follows several equally vehement studies in recent years, as well as those from other credible climate researchers.

If we are finally going to start taking the IPCC’s findings seriously, it follows that we must begin advancing far more aggressive climate stabilization solutions than anything that has been undertaken thus far, both within the U.S. and globally. Within the U.S., such measures should include at least putting on the table the idea of nationalizing the U.S. fossil fuel industry.

One specific way to proceed would entail the federal government purchasing controlling ownership of at least the three dominant U.S. oil and gas corporations: ExxonMobil, Chevron, and ConocoPhillips. We could start with these giants because they are far larger and more powerful than all the U.S. coal companies combined, as well as all of the smaller U.S. oil and gas companies. The cost to the government to purchase majority ownership of these three oil giants would be about $420 billion at current stock market prices. This is a formidable sum, but it is only slightly more than 10 percent of the roughly $4 trillion that the Federal Reserve authorized to spend to bail out the corporate sector in 2020, during the COVID lockdown and recession.

The main argument for nationalizing the U.S. oil giants is straightforward. The single most important factor causing climate change is that we continue to burn oil, natural gas, and coal to produce energy. It follows that we must stop burning fossil fuels to have any chance of moving the global economy onto a viable climate stabilization path. By contrast, the purpose of private fossil fuel companies in the U.S. and elsewhere is precisely to make profits from selling oil, coal, and natural gas, no matter the consequences for the planet and regardless of how the companies may present themselves in various high-gloss, soft-focus PR campaigns.

With at least ExxonMobil, Chevron, and ConocoPhillips under public control, the necessary phaseout of fossil fuels as an energy source could advance in an orderly fashion. The government could determine fossil fuel energy production levels and prices to reflect both the needs of consumers and the requirements of the clean-energy transition. This transition could also be structured to provide maximum support for the workers and communities that are presently dependent on fossil fuel companies for their well-being.