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0:55

energy policy is foreign policy

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that always has done but it particularly

1:01

is right now it's , believed

1:03

the vladimir putin timed both his twenty

1:05

fourteen invasion of crimea and his twenty

1:07

twenty two invasion of ukraine around

1:10

tight energy markets

1:12

the thought that he thought maybe rightly

1:14

that he'd have the most leverage to act

1:17

when europe was most dependent on russian oil

1:19

and gas and when leaders everywhere feared

1:22

the domestic turmoil the higher

1:24

energy prices could bring the

1:26

reverse theory was an operation to

1:28

in a decision that alex naive germany's

1:31

uncle merkel thought that integrating

1:33

russia into europe into the energy trade

1:35

might smooth the road to peace giving russia

1:38

too much too lose ever consider doing something

1:40

like well what it's doing

1:42

right now all , is to say

1:44

to understand this war to understand this moment

1:47

to understand this world you

1:49

need to understand global energy production

1:51

and global energy markets you need

1:53

to understand why war in ukraine raises

1:56

gasoline prices gasoline california the

1:58

need to know why the fact that america

1:59

this is more energy than it needs the

2:02

fact that we dot to that much vaunted

2:04

much desired energy independence doesn't

2:07

actually make us energy independent it doesn't actually protect

2:09

us from disruptions half a world away and

2:12

in the bigger broader sense

2:14

we need when hard about what all

2:17

of this domestic sensitivity and turmoil

2:20

around the price of the pump means for the always

2:22

looming threat of climate change how

2:24

would you decarbonise in a world where people

2:26

care more about the price of fossil fuels today

2:29

that about the devastating consequences are

2:31

useful bring tomorrow

2:33

the wanted to bring someone of the show really does

2:35

understand gallbladder to markets

2:37

yeah you're doing is an economic historian and writer

2:40

who did your parents called america's most influential

2:42

energy pundit time ,

2:44

said vote if is one man whose opinion

2:47

matters more than any other global energy markets

2:49

it is daniel yergin he's the

2:51

author of author bunch of books or the intersection

2:54

of energy and geopolitics including

2:56

the pulitzer winner the prize at the

2:58

epic quest for oil money and power

3:00

most recently the new map energy

3:03

climate and the class of nations and

3:05

the new map hypocrite map few years ago

3:08

who would guarantee pressure that the lengthy

3:10

sections on ukraine and russia now read

3:12

like they're written by someone telling the future but

3:15

you're going doesn't tell the future the just watches

3:17

the energy you don't the vice

3:19

chairman sep global focusing on energy

3:21

to national relations and economics of

3:24

you want to go deep on how energy markets work and

3:26

what they mean for about politics see as

3:28

a guide to talk to and so i talk

3:30

to i was always my email as ripon

3:32

show at n y times dot com

3:38

the new york and welcome

3:40

to the shop thank you glad to junior

3:43

the average price of regular grade

3:45

gasoline and us shut up about twenty

3:48

two percent over the past two weeks from when

3:50

we're talking and that's after

3:52

the russian invasion of ukraine but to

3:55

me mechanically or

3:57

operationally what's happening behind

3:59

that has of we're halfway across the world

4:01

result in be paying higher gas prices

4:03

in california there are the

4:05

answer is that it's really a global system

4:08

that moves about one hundred million barrels a day of

4:10

oil around the world and it's

4:12

fairly finely balanced if you start

4:14

to have disruptions in one place it shows

4:16

up quickly and another and another

4:18

prices go up people have to scramble

4:21

to get other oil to replace oil is they

4:23

can't ship so it starts

4:25

with what's on the tankers or coming

4:27

from one part of the world to another and

4:29

then you get to the refineries and once

4:31

it's in refineries than the prices

4:34

move up as the

4:36

i'd have a whole market moves up because the prices

4:38

for products much gasoline is a number

4:40

one products really are defined

4:43

by the price what happens to crude oil

4:45

how me a bit about why the

4:49

invasion of ukraine has

4:51

done so much to change the oil price because

4:53

i mentioned it's shot up and us that twenty two percent

4:56

russia only counts for eleven percent

4:58

of the world's oil output ender oil output

5:01

is still flowing it's we've been making

5:03

them more money as will talk about than it did before

5:05

so why is is changing prices so

5:07

much

5:08

welcome back to but it's not so anyway and

5:10

before it's really changing and out will come

5:12

back to this kind of cel sanctioning this going

5:15

on is , there's not

5:17

much spare supply in the world but

5:19

also you know the oil market look what's happened

5:21

the stock market all the markets

5:24

that register prices of one kind or another

5:26

are registering not only in

5:29

terms of oil the destruction but also

5:31

the fear factor that twice

5:33

latimer potent is threatened latimer least twice

5:35

is threatened use nuclear weapons that

5:37

this is gonna escalate house this innocent

5:39

say why innocent the stock market going down because

5:42

ones that have to do with with russia but it's

5:44

all caught up in terms of the sense

5:46

of greater risk and in terms of oil

5:49

supplies and other commodities by other weights

5:51

wheat prices are shooting up which is a real

5:53

problem for middle east north

5:55

african countries depend on russian wheat so

5:57

this is part of actually part larger this

6:00

the it turns out the

6:02

goal of the sanctions has been to unplug

6:04

russia from the global economy the turns

6:06

out there are lots accords the connect russia

6:08

to the global economy and course oil

6:10

and natural gas are among the most

6:12

important

6:14

the want you to expand on what you said about

6:17

russian oil and gas not

6:19

falling as it was before because

6:21

i've been surprised by the scene estimates

6:23

from among others bloomberg have your blas

6:26

saying that we're paying mortified mere

6:28

pittance russia today of the west at least it

6:31

the parent invasion for oil and gas

6:33

that if you actually watch the

6:36

the pipeline lot of it is blowing but

6:38

that was a couple in a week or two ago that he

6:40

me that calculations for that changed

6:42

how how is the actual flow

6:45

of energy from russia shifted

6:47

though just

6:48

the layout the numbers russia exports

6:50

seven a half million barrels day of oil

6:53

but , you say it's eleven percent the production but some

6:55

of that stays in russia of course course

6:58

half of that goes to europe and

7:00

what's happening we see now is that

7:03

one or two million barrels a day of

7:05

russian oil that would normally be loaded

7:07

into tankers is not been own it could

7:09

attackers are there because people won't take

7:11

the oil then , the additional

7:14

think that it is russian oil this and the season

7:16

tankers can't find a port because

7:18

it's been rejected rejected us

7:21

and you're set out to do this they said okay

7:23

we're not going to sanction oil and gas

7:26

were not to prevent us from slowing because

7:29

we want keep your

7:31

up supply want to keep nato supplied

7:33

we wanna keep ironically ukraine

7:36

supplied because ukraine uses

7:38

russian diesel and also

7:40

we want to maintain the maintain the we don't want

7:43

people say why my pain so much at the pumps

7:45

but what happened is that you

7:48

put sanctions on ships or on insurance

7:50

or bank say i don't wanna financed

7:53

this sort term finances what you used

7:55

to pick up a load of of of or else

7:57

i don't want to provide you a letter of credit as i don't the

8:00

russians i don't know it's gonna happen i don't want to

8:02

take the risks and you have

8:04

oh companies event

8:07

refiners in europe say we're not gonna take anymore

8:09

russian oil even though we don't know where we're going to get

8:11

the alternatives barrels and

8:13

people's now come to see it as an ethical thing

8:15

we don't want russian oil soaps

8:18

disperse kind of a process of self section

8:20

going on so the one hand on every barrel

8:22

he sells he makes more money but

8:25

he's selling fewer barrels and i think this

8:27

cel sanctioning the rejection of russian oil

8:30

is going to increase gas

8:32

is flowing it seems and hasn't

8:34

been disrupted gas prices have

8:36

been very high us

8:39

liquefied natural gas now compete with

8:41

russian gas in europe but there's

8:43

expectations that that will be cut

8:45

back to and the europeans are say we

8:47

are going to cut the cord to russia

8:50

we don't know how fast we're going to do it but we're going to

8:52

do

8:53

tell me about the relationship

8:56

between domestic prices and and

8:58

the global market let's focus here on the us

9:00

a story telling your book is , the us

9:02

has had an energy production revolution

9:05

in recent decades decades we

9:07

achieved and some theoretical

9:09

way that long time for the golf energy

9:12

independence we are a net energy exports

9:14

we produce more than than we need

9:17

and i think got a straightforward read

9:19

about would say well for a net exporter

9:21

than of course you know when it had a couple turbulence

9:24

we can just turn more of our energy

9:27

had domestic usage and and keep prices low

9:29

and family partition to do that if they could

9:32

and it seems like the

9:33

hand so why despite

9:35

our are tremendous amount of energy production

9:38

how can we not protect ourselves

9:40

more from global market fluctuations

9:42

we are certainly protected more

9:44

on natural gas people noticing a natural gas

9:47

bills are going up but they're going up

9:49

maybe twenty percent thirty percent they're

9:51

not going up like in europe with or four five

9:53

times higher than normal on oil

9:56

a lot of the shale oil we produce is not

9:58

suitable particularly for me the gasoline

10:01

because of the quality of it so that

10:03

gets exported and we import

10:05

other oil that is more

10:07

conducive to our refineries which been set

10:09

up to process what are called heavier

10:12

oils and then addition the

10:14

northeast particularly is connected to

10:16

world markets and it imports up product

10:19

into the united states to make gasoline

10:21

and things like that so the

10:24

numbers it looks like oh well we're even

10:26

but is the quality of the oil

10:28

and so we export the kind of

10:31

oil that lot of the oil it doesn't

10:33

work in our refineries but import

10:35

other oil that's how you get us to been

10:38

net zero importer

10:40

but he have to netted out so we

10:42

are still were and particular gasoline markets

10:44

are very connected worldwide

10:47

what a back up to the energy picture

10:49

before russia's latest

10:51

invasion of ukraine because obviously their been authorizations

10:54

of ukraine in in recent years but backing

10:56

up a couple of years

10:59

story you tell in your buck new map

11:01

is it there's been a real dramatic shift

11:04

in the energy production markets from

11:07

the being opec the the and

11:09

they'll approaching cartel basically a

11:11

non opec to what you know call the big

11:13

three how me about

11:16

the big three and and the shift their

11:18

that number one big three is the

11:20

united states and that is the huge turn

11:23

around in two thousand two

11:25

thousand us imported on a

11:27

basis sixty percent of toil today

11:30

we're basically self sufficient if you look

11:32

on her neck basis and , the would

11:34

like world's largest oil producer this was

11:36

unthinkable a decade and half ago ago

11:39

other two big three are russia and

11:41

saudi arabia who trail the united states a little

11:43

bit and they're roughly tied

11:45

in terms of their production and so

11:47

the arrival of the united states has really

11:49

changed the global market when

11:51

the stories i haven't a new map is in

11:54

twenty nineteen rainy

11:56

and how see from yemen

11:58

and rainy and miss i and

12:00

at the drones hit a

12:03

the largest oil processing

12:06

facility the world in saudi arabia and

12:08

, that happened three or four years earlier there

12:10

would have been panic in the market which

12:12

changed it was it suddenly you you

12:14

have the us is a really big player in a gives

12:16

a new sense of energy security security

12:19

what's happened in the last couple of couple

12:21

is this thing called spare capacity

12:24

which is the oil that's not

12:26

been produced which is like got a safety

12:29

reserves dot is really shrunk

12:31

during new pandemic when things were shut down

12:34

oil demand plummeted prices went

12:36

to some sort of unemotional a

12:38

negative prices which meant some oil

12:40

people were paying people to take their oil away

12:42

because he couldn't get it couldn't market the

12:44

oil business those cyclical that this has been

12:46

a really picks the the sharpest cycle

12:48

i i know of and what happened

12:50

is coming out of the pandemic oil demand was

12:52

much higher than may people her anticipate it's

12:55

with the recovery with people going out the

12:57

world suddenly went from having

12:59

a lot of extra oil around the world that you could

13:01

put into production if you needed it to a

13:03

very tight balance and so even

13:05

before the crisis oil

13:08

prices were high because

13:11

and world's didn't have enough supply herbs

13:13

seem to be headed to place not having

13:15

enough supply and the same thing

13:17

happened with natural gas

13:20

particularly in asia and europe where

13:22

again to demand was much stronger than people

13:24

thought and so supply was

13:27

struggling to keep up so that's

13:29

why i say that even before this began

13:31

you basically had an energy crisis

13:33

in europe which is really been

13:36

hit hard by rising natural gas prices

13:38

much more so the united states where

13:40

we are more separated and then on top

13:42

of it you have one of the big three oil

13:45

production and one of the big three in

13:48

a natural gas production the same country

13:50

potent russia going to war

13:53

on war whole series of miscalculations

13:55

that that's what's in of further disrupt

13:57

it a market

13:59

what was

13:59

find the us is big energy turnaround

14:03

over the past couple of decades

14:05

you have that i have three

14:07

it was thought that us was going to become the

14:09

world's largest importer of natural gas

14:12

but , was a seem cool the sale revolution

14:15

driven basically by one man

14:17

named george mitchell who just had a conviction

14:20

that somehow you could get gas out

14:23

of these dance sale rock which to

14:25

textbooks and was not possible possible

14:27

he plugged away at at for over twenty years

14:30

and then after about your twenty five it was

14:32

really prove that you could do it using when

14:34

it's called directional drilling and hydraulic

14:37

fracturing otherwise known as fracking and

14:39

it turned out to be much bigger than anybody new

14:42

so first we sort of went to became

14:44

of went lng export or because we

14:46

have so much gas in this country lng

14:48

being liquid natural gas liquefied

14:51

natural gas which is a it's expensive

14:53

process cost ten billion dollars perhaps

14:55

to build an lng processing plants

14:58

and then they said well i won't

15:00

work for oil because oil molecules are too big

15:02

to sort of to the rocks well

15:05

turned on or for oil to and it was

15:07

transformative and lot of people thought

15:09

it wouldn't work and i have the

15:12

story in the book about personal

15:14

episode i had with vladimir putin i

15:17

was attending think ah to st petersburg national

15:19

economic forum and he was up there with chester

15:21

merkel any to see the ice between the two of them

15:24

they said oh we are you to as the first question

15:26

so ask the normal question would

15:28

you going to do the potent to

15:30

diversify your economies you're not so dependent on

15:32

oil and gas and are really dependent on oil and gas

15:35

an , mention the word sale and

15:37

he started shouting at me before i finish my

15:39

questions about how barbaric and terrible

15:42

shale is is as i've

15:44

reflected on it is becoming clearer today

15:47

even like shell for two reasons one because

15:49

he knew that the us natural gas in their

15:51

former that liquefied natural gas would

15:53

be competing with his gas in europe and

15:55

he didn't like that any realize

15:57

that this would change the position of the u s we

16:00

would be at more flexibility what we

16:02

we do and our foreign policy

16:04

in our relationships with the world that

16:06

it would give us a whole new set of relationships

16:09

with countries like india and

16:11

we didn't have before and it would strengthen

16:13

us businesses so he hated sale

16:16

the right in the book that put

16:18

in talks about energy more like

16:20

an energy company ceo than your typical

16:23

president or prime minister tell me about that

16:26

i guess it's an , aren't aren't

16:29

bad as as i don't act more like

16:32

a ceo a rational

16:34

ceo until a couple of years ago

16:37

it would seem and people

16:39

who's dealt with him and negotiate it with

16:41

him say that he shows a surprising

16:44

mastery and interest surprising mastery details of

16:46

the energy business very knowledgeable

16:48

and i think that one of his calculations

16:51

miscalculations was he looked

16:54

at said boy to title oil market it's a tight

16:56

gas market is a tight coal market

16:58

so that gives me a a high card

17:00

and then i have another energy card to play

17:03

europe is so dependent on

17:05

oil and gas that deal kind

17:08

of do what they did after i took crimea he

17:10

says to himself which is they'll

17:12

say protests and say oh no this is bad

17:14

and the know kind of say well we have to look after

17:16

our energy supplies and

17:18

well we'll just stand aside and

17:21

he just completely the opposite reaction

17:23

when , you want to do was under my nato he strength

17:26

and nato and he's done this remarkable

17:28

thing he's changed the policy germany

17:31

chancellor salsas a couple of weeks

17:33

ago basically said we're going

17:35

to back away from russian energy we're going to build

17:37

terminals to receive us lng

17:40

lng this relationship with russia is

17:42

over and for it's

17:44

fudan whatever happens in ukraine

17:47

this happens in major defeat for him that he's brought

17:49

on himself and shows

17:51

series of a terrible miscalculations

17:55

that of course are having a huge human cost

17:57

in ukraine

17:58

talk a bit about the the i'm in russian

18:01

energy relationship because story

18:04

and the american kind of story i think isn't well known

18:07

germany have had this very commercial

18:09

relationship under merkel who's understood as

18:11

a shock critic of put him

18:14

where she doesn't

18:16

just accept but supports the

18:18

building up the second pic pipeline and

18:21

donald trump you know for whatever his wife

18:23

his this constant angry

18:25

critic europe

18:28

being so reliant on unrest natural gas

18:30

and he harangues merkel at

18:32

it at a meeting and she's

18:34

certainly snaps back at him quickly

18:36

tell a bit about that story

18:39

certainly other you know merkel grew up

18:41

in east germany and i think

18:43

no one needs to tell her about

18:46

domination from moscow only sheath

18:48

she lived it but he did

18:51

attacker and of

18:53

against nord stream to nord stream

18:55

one the first pipeline there's a picture

18:58

in picture new map of western leaders

19:00

and you leaders and russians

19:02

and all sort of started turning the pipe to turn

19:04

it on that i was two thousand

19:06

and eight roughly in this is a very

19:08

different year and so this new pipeline became

19:11

very controversial ios

19:13

they're not been controversial war it would

19:15

not necessarily change the amount of gas that

19:17

russia sent to europe it would change the way it got

19:19

there because most of russian gas

19:21

used to flow through ukraine because

19:24

ukraine was part of the soviet union and that's

19:26

how they built the pipeline's in ,

19:28

century russia has been building pipelines so

19:31

can send gas and not depend upon

19:33

ukraine but i did merkel still

19:35

regarded it as primarily

19:38

a commercial deals that was interchange the overall

19:40

gas balance and germany

19:42

had decades ago pursued

19:46

the to trade that is a sort

19:48

of you built up the economic relations with the soviet

19:50

union that would weaken new iron curtain

19:52

and that it would give a sort of positive

19:55

side to the relationship that otherwise

19:57

was dominated by animosity by animosity

19:59

weapons it hard came out

20:01

of that and you can say that that

20:03

sort of scraped away the

20:05

iron curtain because russians soviet

20:07

people kind of axes learned about the rest

20:09

the world so nord

20:11

stream to was part of that but

20:13

obviously the politics of been changing pretty

20:16

, once the russian invasion

20:19

of ukraine ukraine are going

20:21

to have determines how to figure out how to get

20:23

out of it and they are gonna

20:25

do a new national security evaluation

20:28

because now not just jeremy

20:30

but yorkers since we're gonna use

20:32

a lot less natural gas from russia was

20:34

used in the past and going to find a way to

20:36

use less oil from russia russia's

20:39

gonna pay gonna price it's not

20:41

a price it's that they'll pay tomorrow

20:43

but a surprise over the next few years and

20:45

nord stream to now is going to be

20:48

is suspended animation

20:50

line in the bottom of the baltic sea is

20:53

never going to be filled

20:54

i think something that is lurking

20:56

and there's two different ideas of

20:59

how energy relationships my create

21:01

power so one which

21:03

is this broader neoliberal globalization

21:05

idea is that

21:07

trade ties create peace

21:10

they keep relationships to create stability

21:13

another argument is that

21:15

having the , yourself

21:17

is what creates power trade ties

21:19

on you create dependence which is great

21:21

for your power and it's very much

21:24

been put in feel but it's also to some

21:26

degree and the you argue on

21:28

america's a half that as we've

21:30

become a more dominant energy producers

21:33

it's given us a level of

21:36

geostrategic flexibility that

21:38

we wouldn't have had if we weren't as

21:41

big of an energy producers can

21:43

you talk can you about that a party in terms

21:45

of the russian case what do you think we've

21:47

been able to do or push for here

21:50

that we wouldn't have been able to do or push for

21:52

in the energy equilibrium mug

21:55

two thousand and one

21:56

let me give you a very vivid example

21:59

when the us that they had a surplus

22:02

of gas job at the scene causal

22:04

lnc liquefied natural gas which

22:06

is you basically freeze

22:08

the gas to a very low temperature

22:10

and turned a gas into a liquid you ship

22:12

it to another country and a put it into

22:14

another facility in turn it back into gas

22:17

and put it into their pipeline system so

22:20

we started building detect sports facilities

22:22

to take time

22:25

what is shown is that this turned

22:27

out to be a geopolitical asset for the united

22:29

states there was some time

22:31

in january for instance when the us lng

22:34

going to europe was actually greater than the volumes

22:36

of gas that , was getting

22:39

from russia if we didn't have

22:41

lng export in the united states europe

22:43

would be in a much worse state would

22:46

have state would more difficulty withstanding

22:48

that the pressure from russia so

22:51

this is the classic example where this has turned

22:53

into a geopolitical asset for

22:55

the united states beyond it's economic

22:58

it's energy value i mean we just

23:00

at our a conference or in houston

23:03

and it's officials were coming over from europe

23:05

going up to anybody they thought had any potential

23:07

for lng you know can you get us to more us

23:10

lng now there's also lng that comes

23:12

from gutter comes from australia from

23:14

nigeria from other countries but the

23:16

us this year the

23:18

not produced any significant

23:20

lng until twenty sixteen

23:23

can end up the world's largest exporter of lng

23:26

and that's something that couldn't really

23:29

the are coming and did not like get

23:31

that is a very important element now in the

23:34

balance of power or wet dog

23:36

soviets used to call the correlation forces

23:39

struggle at has

23:42

nothing hiding him as conversation

23:44

is it were talking about energy markets

23:47

but we're talking about different markets and

23:49

very confusing the in america we call

23:51

oil gas why it's his a very good way

23:53

of conflating different markets but

23:56

but can you talk a bit about the differences between

23:58

the oil and gas markets and how

23:59

work

24:01

sure is similar in europe and and

24:03

in england they call it petrol so you don't get

24:05

this confusion so the

24:07

oil market is market truly global markets

24:09

supplies move around their

24:12

differences in the qualities of oil there's differences

24:14

in there's refineries but at this has

24:16

been has global market for many

24:18

decades and natural gas

24:20

was much more regional markets

24:23

europe was supplied with gas from

24:25

gas huge touch gas sealed that some

24:27

norwegian gas and the us was

24:29

quite separate quite from it but this lng

24:32

business began decades

24:34

ago initially to provide natural

24:36

gas to japan for electricity

24:39

generation and south korea for electricity

24:41

generation but , become

24:44

more of a global market in

24:46

recent weeks lng

24:48

tankers that we're leaving united states destined

24:50

for europe for change direction and gone and delivered

24:53

needed gas to europe so it's

24:55

become more of a global markets

24:57

but not as connected in the way that

24:59

the european market is the us

25:02

domestic natural gas market is

25:05

separated from the global market in prices

25:08

in the us although pomona when

25:10

they look at their bills will see higher are much lower

25:12

than they are in other parts of the world

25:15

so i guess you could say the oil business

25:17

is a globalized business and

25:19

at the natural gas business is becoming

25:22

more globalized

25:24

what about when the specific example

25:26

of where

25:27

the us is rising gas production

25:30

eva maybe foreign policy laboratory wouldn't

25:32

have otherwise had i'm

25:34

typically relatively skeptical of sanctions

25:37

and sanctions and will they work but whenever

25:39

i talk to people who work on sanctions

25:42

the example the give me of them working

25:44

is iran and i think that's correct

25:46

that the sanctions did push around

25:49

towards the nuclear deal that

25:51

later told trump shredded but it was an

25:53

achievement what when it was done what

25:55

do you argue is it it's the shell revolution

25:58

that made the the nuclear deal possible

26:01

tommy why

26:02

we decided to put

26:06

sanctions on iran

26:08

step i'm up to force them to the negotiating

26:10

table in two thousand and twelve it

26:13

only been two or three years earlier that people

26:15

have figured out that you could produce shale

26:17

oil well as shale gas

26:20

i know i have i have in the new map from one

26:22

of the rainy insane the sanctions

26:24

will never work the world will need

26:26

our oil will be selling the oil people

26:28

beat beating on our doors and

26:31

a kind of just dismissed the fact

26:33

that the us production was going

26:36

to increase so fast that

26:38

in a year to we were producing

26:40

more oil than earth added

26:42

added more oil than iran was exporting

26:45

and so that was a time when it

26:47

was more supply in the world market and

26:50

unlike what were we are now and

26:52

so there was you could go get oil

26:54

from somewhere else or someone else because

26:56

there was a lot of oil around and it was the sale revolution

26:59

that made those sanctions work

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27:33

podcast

27:34

michael slackman this is the managing editor

27:37

the new york times oversee international coverage

27:40

when the russian military decided to

27:42

begin it's attack on ukraine we

27:44

were there from the moment the invasion

27:46

began our reporters photographers

27:48

videographers audio experts

27:51

were there to bear witness we want to make

27:53

sure that is a town hall as shit is so

27:55

hospital as hit at the world knows

27:58

and they will know because our people are they're

28:00

putting themselves in harm's way not

28:02

for glory but for a mission it's

28:05

our job to really try to figure out

28:07

what the truth is what the facts are on the

28:09

ground in the newsrooms of new

28:11

york london and soul we also have dozens

28:13

and dozens of journalists working on

28:15

twenty four our live coverage the

28:18

new york times can help you fully understand

28:20

what's happening with this war now and

28:22

what it might mean in the future if you want

28:24

to keep up with what's going on in ukraine follow

28:26

our coverage at n y times dot

28:28

com slash ukraine

28:41

the we've been talking here about

28:43

the transformation of the producer

28:45

side of the energy market but is

28:47

often a pretty big transformation on the buyer side

28:50

practically around china emerging

28:52

as the world's largest energy importer

28:55

tell me about their merchants and how that has

28:57

changed the global dynamic

29:00

here

29:01

what a change until the early nineties

29:03

china was actually and exporters' or hill

29:06

and , in the early nineties started becoming

29:09

an importer of oil and

29:11

for the chinese they may have

29:13

members going back to the korean war when

29:15

we cut off oil supplies to them

29:18

them so for them or oil became

29:20

a strategic a and

29:22

they built up their oil industry and

29:25

they took a ministry of it petroleum

29:27

and turned it into a series of energy companies

29:29

when around the world and developed oil

29:32

and so they become a major player in world

29:34

oil in different countries but

29:37

their consumption they're gross out run supply

29:40

so today china's in the position of importing

29:43

seventy five percent of its oil and

29:45

a see that as a huge security problems

29:48

and they have gone around the world to try

29:50

and diversify their sources and

29:52

that's one of the bases of the relationship

29:55

that potency in china and russia have

29:58

it because russia is

29:59

no

30:00

major supplier and along with

30:02

the middle east along with other countries

30:05

in africa they regarded

30:07

as the strategical vulnerability in

30:09

fact despite

30:11

the fact that us chinese relations

30:13

are in a pretty rocky stayed china

30:16

is signing up long term contracts to bite

30:19

us lng is part of their diversification

30:21

strategy

30:23

one geopolitical consequence of that shift

30:25

which you just that they're it is

30:28

a , russia china alliance what

30:30

of you're quoting the book is a relationship that was

30:32

once based on marx and lenin is now grounded

30:35

in oil and gas tell

30:37

me about that

30:38

it is so true and when

30:41

couldn't and next crimea

30:44

and we put sanctions on him back then

30:47

lobby see it and do much good he

30:49

high tailed it to beijing and

30:51

signs a huge natural gas deal

30:53

with china so china

30:56

power siberia pipeline is

30:58

other pipelines oil and gas has

31:00

become has very important

31:02

trade for china russia

31:05

basically a source of raw materials

31:07

and oil and gas or the top of it but

31:09

, not only sort of china and russia

31:12

i think it's receipt z and couldn't and

31:15

i remember being added another

31:17

st petersburg economic forum where

31:20

wouldn't main guess was none other

31:22

than she should paying present china and

31:24

potent begins by saying mister

31:26

president or whatever he calls and i apologize

31:29

i kept you up so late talking it was four

31:31

o'clock beijing time when finished and

31:34

, said we never have enough time to

31:36

talk talk i think we can

31:38

be sure that one of things they talk about is

31:40

the us and europe and that they want

31:42

to overturn with a

31:44

season international order that led

31:47

by the us and europe and

31:50

they keep saying that each other serve their

31:52

very best friends but friends think

31:54

now we're really have really hinge point

31:56

and will seal the next few weeks does china

31:59

align it family with

32:02

two countries by the way where the leaders

32:04

of our more or less president

32:06

for life for does china step

32:08

back from where they may see

32:10

as curtains reckless disaster

32:13

that he's launched in ukraine so

32:15

people are looking for which way's the the

32:17

chinese are gonna go are they going to try and play

32:20

both sides of the street but they

32:22

don't wanna see the impact on

32:24

the world economy and monday pay

32:26

i prices for oil to by the way but

32:29

the general disarray that this brings to the world

32:31

economy and disruption particular

32:33

when she is planning to get his third term

32:36

as president apparently no one is

32:38

running the primaries against him

32:41

when you look at the trade for us between

32:43

russia china and the energy flows a big an

32:45

important so

32:47

you done in five five percent of

32:49

russian oil exports went to china now it's

32:51

about thirty percent of a russian oil

32:53

exports before the war here russia

32:56

past saudis past china's top

32:58

oil supplier the two countries signed this

33:00

big thirty year four hundred billion

33:02

dollar gas steel and twenty four teams

33:04

but teams point you make is that as important

33:07

as trading partner

33:09

the resources partner as russia

33:11

is to china russia pales

33:14

before

33:15

the us as a trading partner to

33:17

china can you talk bit about that

33:20

yes first of for poon has said

33:22

that the future is an asian we we

33:24

rush out that is has to reorient towards

33:26

asia he regards europe and

33:29

the united states is kind of because indebted

33:31

countries that there are on

33:33

a downward slide and at the future

33:36

is asia and that really means china

33:38

but for china russia

33:41

is important strategically to share

33:43

long border russia is

33:45

important as a source of raw materials

33:47

and is somebody has a country that sees the world

33:49

the same way but economically

33:52

china's trade with us is so much more

33:54

important and the us and china

33:57

are so much more integrated

33:59

than people recognize that

34:01

many the prescription drugs or over the counter

34:04

drugs you buy come from china

34:06

and china's had a similar dependence on the

34:08

united states in this era of globalization

34:12

production spread out efficiency

34:14

was the goal and china became

34:16

the workshop of the world you

34:18

know for general motors sino speaker

34:21

auto market for them than the united states so it's been

34:23

a two way street and china

34:26

and united states i think in the

34:28

era of post cold war globalization

34:31

it , a time of what a call on the

34:33

w t o consensus that

34:35

china and the united states were part of the same

34:38

trading system system that we

34:40

would all benefit from been part of the global economy

34:43

of though you know obviously you'd be jobless united

34:45

states and production would shift and so

34:47

forth and that it would be and underpinning

34:50

and peace but

34:52

you know that's gone now we're in a different

34:54

here with china for sure to

34:57

the new map for i went back and looked at the

34:59

national security statement for

35:01

the last one from the one administration

35:04

and it talked about engagement with china working

35:06

with them on global issues and then

35:08

i looked at his first national

35:10

security documents from the biden ministration

35:13

didn't have any that language with strategic competitors

35:15

great power rivalry very

35:18

different language and by the way is

35:20

kind of written by more or less the same people that

35:22

shows you as or how much had changed and five

35:25

years and a chinese language has changed

35:27

our under president she dates talk about

35:29

unilateralism and that means the i

35:31

states and that's bad and state to talk

35:33

about great power of competition and

35:36

if you look at what the us and chinese

35:38

military is there really kind

35:41

of kind where they're spending a where they're going to be focused

35:43

on the focused on each other so that's

35:46

a different era and so think

35:48

when the biden machine came think they thought it might be some

35:50

hope appealing russia away

35:53

from china because it would be better

35:55

off the rusher economically it's

35:57

or doesn't end up an economic colony china but

36:00

the early that hasn't worked so china

36:02

and russia very close to teach likely

36:04

but we still have is very complex

36:07

economic relationship with china that

36:09

is more significant for both

36:11

countries that people

36:14

recognize

36:15

let's talk about the possibility of of russia

36:17

becoming an economic colony of china

36:19

because for all prudence

36:21

concern about russian power

36:24

the russian land and russians

36:27

role in the global order of the future

36:29

one of the very likely it seems

36:32

to be long term outcomes of this of

36:34

this as as people said functional

36:37

vassal state of china's produces

36:40

i mean one because he needs them and they

36:42

can buy can bunch of his energy but the to

36:45

no backup a year to and

36:48

for everything we spoke about with germany and

36:50

the pipeline through there were building europe

36:52

was willing to be very dependent on russian

36:55

oil which meant you're willing to pay russia lot of money

36:57

and whether they can

36:59

off of it quickly and will will talk

37:01

about that there is no doubt that

37:04

one of the primary realizations

37:06

the europe is come to an asus they do not want

37:08

to be dependent on russian oil

37:10

and gas they do not want to be in

37:12

a position where vladimir putin or whoever

37:14

succeeds him at of europe's energy

37:17

future so has

37:19

the didn't meet up pretty big this

37:21

calculation here in terms of russia's long

37:24

term power really only having

37:26

china and india sell to

37:28

to seems like a much weaker economic position

37:31

that's a very key point

37:33

i think so often histories

37:36

, about people's miscalculations and

37:40

setting out information not understanding

37:42

what they're doing and if we

37:44

look at beginning with foods

37:46

assumption that in five days

37:49

ukraine would collapse it would be like crimea

37:51

part to and just take over the country russia

37:53

supplies twenty nine percent of russia's gas

37:56

and thirty five percent of its oil high

37:58

degree of dependence then he thought

38:00

that was locked in and it wasn't gonna change

38:03

but the europeans are said

38:04

we're done

38:06

radha you're not addicted to do not going to get out

38:08

of it as fast as they think that we do

38:10

not wanna depend upon russian

38:12

gas to disagree we have we're going to bring

38:14

it way down and we've been trying

38:16

do the same on oil it's ,

38:19

going to be easy to do that but there are a lot

38:21

of things that they're gonna do right away to do that

38:23

so i think russia has done is east

38:25

russia was it although he didn't like this term

38:28

and energy superpower what is now

38:30

going to do be do is it's going to be reduced

38:32

energy power and it's

38:34

going to have trouble selling his products

38:37

the oil they'll be able to sell at to sell

38:40

india to asian countries presumably

38:43

natural gas can be a bigger problem because

38:46

you can't just pick up the pipeline to go from

38:48

russia to europe and have appointed

38:50

some other direction so is gonna

38:52

be they're going to have a shrinking gas market

38:54

so he's taken steps to impoverish

38:56

russia from here on it took my

38:58

what he's done russian oil and

39:00

gas was sometimes as high

39:03

as forty six percent of his budget and

39:05

is to start going to have those earnings in the future

39:08

it's gonna be rocky not going to

39:10

be smooth and i think consumers are beginning

39:12

to see that right now but

39:14

russia's role is as days as

39:16

an energy superpower i think our up

39:19

over and he's really signed a death warrant

39:21

for that

39:22

there's been a lot of frustration bit europe

39:25

and and to some degree united states although we've more

39:27

recently banned russian oil imports

39:30

but , europe has maintained the

39:32

speak carve out in the sanctions for russian

39:34

energy and as you said

39:36

it may be the amount of energy getting

39:38

out of russians know going down but because prices

39:41

is making

39:42

houdini and rush arsenal making a ton of money

39:44

on selling energy to europe every single day

39:47

how me about the reality beneath that

39:49

what would happen to europe

39:51

the beautiful tomorrow no more russian

39:53

energy or setting off the flows

39:55

it depends how quickly you

39:58

can get additional oil from the least

40:01

the us sent a delegation to caracas

40:03

to talk to maduro i see you

40:05

know can we make a deal maybe we can get some

40:07

more oil canada ,

40:09

is actually our largest supplier

40:12

of oil can produce some

40:15

more oil to so people

40:17

will scramble for barrels

40:20

it's easier to scramble for barrels when there's a lot

40:22

of extra supply around there's not a lot of extra

40:24

supply supply iran on

40:26

which sanctions are raised because of

40:28

a of , nuclear deal or

40:30

reese restoration of the nuclear deal could

40:33

put more oil into the market but it would

40:35

be tight and disruptive were

40:37

already seen the effects

40:39

of that in europe in terms

40:41

of prices and part of the problem

40:43

is the pipes are in place

40:45

in eastern european refineries

40:48

i , really can

40:50

only be supplied with russian oil because they depend

40:52

upon the russian jews but pipeline

40:55

that they don't have a can't easily get

40:57

other oil so if you just stopped

40:59

at all tomorrow tomorrow know it

41:02

might even be hard for the ukrainian military to

41:04

fight because they wouldn't be able to get

41:06

any diesel fuel that they need for

41:08

their equipment house

41:10

the flows to china are going to continue soak

41:13

your half of this exports go to europe they arrest

41:15

go asia basically and

41:17

those sales will continue over

41:20

time that market's going to decline

41:23

in the europeans are going to do a lot of other things including

41:25

be more energy efficient build more

41:27

when turbans in order to

41:30

generate like shit additional literacy was when

41:32

rather natural gas and i think we're gonna see

41:34

them bernie more colas a least for the next couple

41:36

of years

41:37

i wanna pulled it out a little bit

41:39

of both

41:39

your rational economic analysis

41:42

because the inner the frustration is

41:45

deep in the blood of this moment

41:47

ukrainians are dying now russia

41:50

invading ukraine now the

41:52

why doesn't your up stop the flow

41:55

of oil and gas

41:57

now

41:58

i'm hoping that other good reason but i but i want to hear what

42:00

would happen what would it would mean for europeans

42:02

if they to said tomorrow no more

42:05

it's very odious to people's to see

42:08

dollars , back to russia right now

42:11

but on the other hand russian

42:13

oil is thirty five percent of european

42:15

consumption if you can't replace

42:17

said economy stock and economy stock we

42:19

already saw before this began because

42:22

of the shortage of natural gas in europe's

42:24

factors were actually shutting down like fertilizer

42:27

plants that make fertilizer for this spring

42:29

planting season shutting down so

42:31

i think you would have that on a larger scale

42:35

and you would have somewhat of an immobilization

42:37

he dosa go back to think about other

42:40

oil crises you

42:42

, create a kind of panic situation panic

42:45

buying and so forth so so

42:47

don't may well com not as formal sanctions

42:49

purchased self sanctioning that's going

42:51

on i was talking to a lady in

42:54

in england yesterday says it's ethical grounds

42:56

i don't wanna buy any product that has oil

42:58

and russian oil it's describes all

43:00

get blended together sometimes it's hard to

43:03

that know what it is but ice

43:05

i would suspect that we're going to going further

43:08

degradation of russia's exports

43:10

to europe not necessarily because its

43:12

mandated by government but by company

43:15

standing back and say we're not going to handle

43:17

russian oil or when i could pick up russian oil

43:19

so there's gonna be economic disruption

43:21

set of are flowing from his i mentioned before what's

43:24

happening with wheat prices low

43:26

in depends upon russia for titanium

43:28

ukraine produces neon that

43:30

use for making computer chips so there

43:32

can be can lot of disruptions with the biggest are going to be

43:34

involved are going and gas and out of course

43:37

can try to prove

43:50

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44:25

the back of a year

44:26

and germany is shutting down nuclear

44:28

plants and building a new natural gas pipeline

44:31

with russia now

44:34

as the situation has changed as their

44:36

estimation of us has changed what

44:38

you're hearing from europe is it the future

44:41

is not as to be less dependent on russian

44:43

energy but the decarbonisation on

44:45

march eighth the european commission

44:47

outline of plan to make europe independent

44:49

from russian fossil fuels while before twenty thirty

44:52

that , tripling renewable energy capacity

44:55

jimmy's finance minister recently cop

44:57

and your butt hurt he freedom energy what's

45:00

your read of how this

45:02

has changed

45:03

the year key and decarbonization

45:05

renewables pathway in reality is it's

45:07

all rhetoric or is is

45:10

accelerating them down a a track there

45:12

are gonna take

45:13

i think it's accelerating down a track

45:16

that or they'll put additional resources

45:18

into it now we get into the nitty

45:20

gritty of or the supply chains there

45:22

you know how fast can you build big

45:25

offshore wind turbines permitting

45:27

i was told last week by one

45:29

is a top manufacturers of wind turbines

45:31

in the world listen in the western world's

45:34

that it takes seven years to get

45:36

a permit for an onshore wind

45:38

turbine in europe onshore

45:40

not offshore permitted is a real problem

45:43

everywhere for building everything but

45:45

i think no question that will speed up so

45:47

now by the way renewables is not only about

45:50

climate about source of energy security

45:53

and that said different imperative that

45:55

they've been kind of an amnesia about energy security

45:58

in the western world including world including it states

46:00

because we just assumed it's all ok so

46:03

, think that will happen you're going to scour the world

46:05

from or lng they will

46:07

burn more coal for a couple of years that it can reduce

46:10

gas imports from russia they'll

46:13

accelerate energy efficiency to accelerate

46:15

the rollout of electric cars and

46:17

i think detailed also focus on

46:19

yet to be developed that for gas

46:22

reserves in and or seats and

46:24

around cyprus which is part of the you

46:27

that i think that will step up as well so they

46:29

if they're gonna move they're a lot of france but i think

46:31

your focus on renewables will

46:33

be at the very front of what

46:35

they're gonna do so they don't have to use

46:37

as much gas for electric generation

46:40

there but a big divergence between

46:42

the us and europe on this isn't some

46:44

argue working at a moron frederick

46:47

bit europe is taking this as an opportunity

46:50

to show decarbonisation and

46:52

in america that the pressure and the policies

46:54

have been towards more

46:57

oil supply in particular is

46:59

he us more fossil fuel oriented in this

47:02

moment or is that just the visual

47:04

difference

47:05

most countries in europe don't produce oil and gas

47:08

the united states does and so what

47:10

are the changes we've seen and heard it from the us

47:12

administration is that we are committed to

47:14

or decarbonization goals but

47:17

at the same time we're in an emergency

47:19

right now this now this emergency can

47:21

we increase our production to

47:24

take barrels away from russia and

47:26

ask in other countries to do that to pretty

47:28

intense negotiations going on with the middle east

47:30

to try and get them this step up production as

47:33

well but you know europe has

47:35

this track anyway there was going and so

47:37

now it's going to accelerated and i think you

47:39

know for europeans living on the

47:41

european continent seen what

47:44

happened in ukraine in the year twenty twenty

47:46

two happy in europe is

47:48

just shocking an unbelievable to them

47:50

that this would happen in this in this century

47:53

you know they have a stark memory world war two

47:56

and a way that we we don't and united states

47:58

and soaks they just

47:59

on hook for russia and

48:02

renewable generation is a very important

48:04

way to do it so spell step on the gas

48:06

in terms of us solar and wind

48:08

there's a case the me right now

48:11

then he carbonization isn't just

48:13

a climate change protection policy

48:16

but also a national security policy that

48:18

you'd have consumers in countries less

48:20

vulnerable to wild swings in the oil and gas

48:22

markets government to be less beholden

48:25

to foreign countries who who dominate these markets

48:28

the argument is right do you think there is a national

48:30

security case for for decarbonization

48:33

interesting though in my previous book the quest

48:35

i i went back and said where did the modern wind

48:37

solar industry come from anyway and only

48:39

emerged in the nineteen seventies

48:42

and , the first thirty years renewables

48:45

for more about energy security

48:48

then about climate then about wasn't

48:50

an issue so the big impetus

48:52

was energy security and

48:54

so maybe sort of of a full circle to

48:56

come back and see this as a

48:59

the energy security now picture is

49:01

is back in the game and ,

49:03

that and away takes you back to the

49:05

forces last winter asked

49:09

climate there were lots to find an alternative

49:11

still important alternative

49:13

i think one of the observations one can

49:15

make in the in the other direction though the

49:18

you really seen over the past and

49:20

he said repeatedly but he thought over the past

49:22

year you seen it over the past week how

49:25

sensitive the domestic politics

49:28

of all these countries are

49:29

a rising energy prices and

49:33

the one hand you can

49:35

make an idealized argumentative weekend

49:38

have this massive energy transition at speed we

49:40

need to have it everything goes well without

49:43

big increases in in energy prices

49:45

on the other hand

49:47

i think that might be

49:50

a little more optimistic

49:52

than is fully warranted by the fact

49:54

that if you want to do for decarbonization

49:56

at the speed many climate advocates say we need

49:59

to do it

49:59

you're gonna see prices go up

50:02

on fossil fuels even before you see

50:04

some of the the renewable capacity

50:06

come on line because it is in part the

50:08

increase in prices are fossil fuels the will get you

50:11

to the renewable capacity that you need

50:13

i'm curious how you read the politics of energy

50:16

prices in this do you think of decarbonization

50:18

it's possible that higher and you prices and

50:21

do you think higher prices are of significant

50:23

obstacle for decarbonisation

50:26

the you really seen as hard as a cut both ways

50:29

last , the tests have a fat

50:31

model why i think was the seventeenth best selling

50:33

car in the united states as prices

50:35

go up at the pump and if you're driving

50:38

thirty miles a day to work and

50:40

you see what the prices are you tend

50:43

to switch to an electric car know electric

50:45

car courses twenty percent plastic which

50:47

we still need oil for production

50:49

they still need oil and people don't realize

50:51

that highland all you take tylenol

50:54

tylenol's in oil products the

50:56

, of a seventy seven chat is

50:58

basically an oil product so

51:00

it's more pervasive in the economy

51:02

than people recognize recognize

51:05

said i believe prices are

51:07

important pieces of information they do a sec behavior

51:10

and decisions are people

51:12

make the either twenty fifty goals

51:15

have been sort of shifted to twenty thirty and

51:17

shifted think we were starting to see in at energy

51:19

crisis in europe before the invasion

51:21

of ukraine that it it could

51:23

be disrupt his of trying to do it really

51:26

fast and at it you

51:28

get reactions against it prices

51:30

go up you get what in france for called the yellow

51:32

vests protested against it

51:35

and i think that's one

51:37

of the on said worries

51:40

about completely shutting russian oil

51:42

out when you don't have replacement is

51:45

that it would such a shock to the

51:47

economy that you're trying to get a you might get

51:49

a backlash in europe say well

51:52

why are we standing so strong against russia

51:54

was let's think about ourselves i think it's

51:56

nobody's saying that publicly but saying think that's

51:58

of private sphere and of course it also

52:00

comes at a time when what used to

52:02

be called transitory inflation is now just become

52:05

inflation and this is a feeding

52:07

into it so you get a

52:09

the shock and by where you take money out of consumers

52:12

pockets that it might be spending other things

52:15

so there are a lot of ramifications

52:17

of it but i think the higher

52:19

price is basically will drive

52:21

in at towards the

52:24

carbonization but it's not a smooth

52:26

road that only smooth

52:28

road economically and

52:30

for consumers it's also not a smooth role

52:32

for politicians

52:34

right and that's what's on my mind your some

52:36

california we have very aggressive decarbonization

52:38

goals and , rising gas prices

52:41

even so either to lot of politicians trying

52:43

to blunt the rising gas prices not

52:45

using them as a big moment to get

52:47

people day useless gasoline and burma

52:49

fossil fuels republicans in

52:51

the california legislature try to fail to

52:53

get a gas tax holiday past gov gavin

52:56

do some thinking about gas tax rebate which

52:58

does it so much danger prices you see if people

53:00

see at the pump but is an effort to ease

53:02

the the frustration here national

53:04

league or releasing oil from the strategic petroleum

53:07

reserve and the something

53:09

you're not seeing here is

53:11

you are making the national security case and decarbonization

53:14

you might say that moment like this on global

53:16

instability sense prices rocketing that's

53:19

the point to the the prices a signal

53:21

that we should take

53:22

to get off of the fuel

53:24

in fact direction i most often human

53:26

politicians is the the

53:29

gas prices himself become immediate problem

53:31

rather than the broader

53:34

vulnerabilities are being reliance on fossil

53:36

fuel like gasoline the this may be

53:38

lurking underneath all this

53:41

that's right gasoline prices

53:43

are so sensitive everywhere in the world

53:46

when there is this upheaval recently in

53:48

kazakhstan it started because the

53:50

price of fuel went up and

53:52

so we don't all different societies

53:54

are we certainly no and united states that it

53:57

is a credibly sensitive politically

54:00

understandably so because people drive

54:02

a lot and it's very painful prefer nurse

54:05

or schoolteacher driving to work

54:07

to suddenly see how much they're paying amateur

54:09

their income is suddenly going into gasoline

54:12

and , reaction of you know politicians

54:15

and is to what can we do

54:17

to of blower gasoline prices prices

54:19

me when i hear right now needs to

54:21

happen is that we really do need regard this

54:23

as a wartime situation you

54:26

need a much closer collaboration

54:28

between government and industry to

54:30

understand the things that we've been talk about ezra had

54:32

of the logistics works what can you do

54:35

to keep the supplies going working get other supplies

54:37

what's happening on what's day to on basis and

54:39

basis think that's what really needs that

54:41

happen i think we're just starting to

54:43

see that because this see that have to be managed

54:46

and this may not be a matter of weeks is could be a matter

54:48

of months

54:49

one of the other counter arguments have begun to see

54:51

floating around it is that even

54:54

in decarbonization world their supply chains

54:57

you're dependent on the and their supply chains

54:59

we don't control so this week

55:01

sen joe manchin said that the quote

55:03

i'm very reluctant to go down the path of electric

55:05

vehicle

55:06

can he did that i'm old enough to remember standing

55:09

in line and ninety somebody for trying to buy gas

55:11

i remember those days i , want to

55:13

have to be standing in line waiting for a battery

55:15

for my vehicle because now dependent on a foreign

55:17

supply chain mostly china and quote

55:20

quote would you referring to there is it turned it does

55:22

dominate the global lithium ion battery

55:24

supply chain they control a

55:26

lot of raw material refining if

55:29

you're looking at solar power they

55:31

are quite dominant it comes to solar panel

55:33

production how do you see

55:36

the supply chain dependence

55:38

question

55:39

around decarbonization

55:41

first let me say i was there when center

55:43

mention made that comment and

55:45

it certainly did stand out and i think

55:47

he's pointing to something they

55:50

, about the new map we all know the term

55:52

big oil rig we're going to be

55:54

moving to be disorder get hacked into any

55:56

or big shovels because the

55:58

sun and the when may be the but the materials

56:00

that go into wind turbines are that

56:03

go into electric cars are very

56:05

physical things that have to be mind

56:07

that have to be process that

56:09

have to be shipped and after be of

56:11

to further processing and ,

56:14

we're going to have new supply chains

56:17

chains net zero carbon for carbon

56:19

is and be more mineral intensive as

56:22

opposed to oil or to

56:24

intensive and where

56:26

the supply chains well the chinese have been out

56:29

chinese in front as you say eighty percent

56:31

of you lithium ion batteries you know

56:33

what did a great things as been a solar revolution solar

56:35

costs have gone down dramatically solar

56:40

major reason is chinese manufacturing of

56:42

they dominate about eighty percent of the solar panel

56:44

businesses well and ,

56:46

suddenly we're going to wake up and there's going to be a

56:48

new geopolitics around his

56:51

new supply chains that you're describing describing

56:54

where they're going to be mind that demand

56:56

for lithium will be enormous

56:58

i mean maybe a forty three hundred percent

57:01

increase by one estimate now

57:03

there's some saw your technology will come to

57:05

bear in there may be the

57:07

possibility of producing lithium in north carolina

57:10

and nevada and so forth but

57:12

, minerals no substantial

57:14

part of the world's cobol comes into the democratic

57:17

republic of congo copper

57:19

is you know comes from a limited number

57:21

of of countries copper electric

57:23

cars are really use a lot more copper

57:25

than your normal internal combustion

57:28

engine so i think securing

57:30

the supplies supplies support

57:33

the pace of decarbonization to people want

57:35

to achieve that's going to be a new challenge

57:38

and there's gonna be a big focus on that and

57:40

then it gets back to we talked about permitting

57:43

before it's hard to open

57:45

a new mine in the united states in takes

57:47

it's estimated by one estimate sixteen years

57:49

to open years new mind from discovery to production

57:52

in the united states the permitting process along

57:54

can take sixteen or twenty years so

57:57

i think you've got to look down the road

57:59

which use your sane and seen where's

58:02

the supplies gonna come from and

58:04

note please that china has a very strong position

58:06

in them when i read on president

58:09

biden statement about what we need

58:11

to do about minerals and metals

58:13

and so forth so decarbonization

58:16

i was just struck by how often china

58:18

was invoked is a reason to do

58:21

they did a study recently with the former

58:24

energy secretary ernest money's looking

58:26

at potential breakthrough technology to could accelerate

58:29

decarbonisation oh me a

58:31

bit about what you found what are what are the possible

58:33

technologies that you most excited

58:35

about right now that you wish we were investing

58:38

more in

58:39

some of it is actually digital becoming much

58:41

more efficient in how we use energy

58:43

and how we manage buildings which use a lot of

58:45

energy i , say that

58:47

of of feet on the

58:49

agenda now almost dramatically

58:52

from dramatically from hydrogen

58:55

and the europeans are now talking about getting

58:57

twenty five percent of their energy were twenty

58:59

fifty from hydrogen so fifty say

59:01

of a top one the

59:03

other is a batteries and energy

59:06

storage if you had a weights

59:08

and you scale to store like

59:10

receive generated by wind and solar

59:13

so that there were no longer intermittent up

59:15

and down sources depending upon the wind

59:17

in the sun but you could store them

59:20

that would change the energy picture so i think doses

59:22

some of the areas is very interesting about

59:24

hydrogen just because so many

59:27

people are jumping on it now

59:29

involves a lot of engineering now

59:31

hydrogen is used as now

59:34

in the oil refineries it's used to make

59:36

fertilizers and so forth so the

59:38

know house their the question can you make

59:40

at large scale and what do you

59:42

make it from do make it from natural gas

59:45

than unique carbon stored for need to be

59:47

able to capture the c o two

59:50

and store it called carbon capture

59:52

or you can you make it from using

59:55

wind and solar and split

59:57

water basically that using

59:59

wind very expensive and get anything

1:00:02

you do an energy that's really gonna have an impact you

1:00:04

need to get scale that evolves lot

1:00:06

of engineering a lot bugs a lot of money

1:00:09

nervous a lot of execution cause that

1:00:11

goes back to where we started the system the

1:00:13

supports the global economy today or

1:00:15

ninety trillion dollar economy is very

1:00:17

big and so you need things that are very

1:00:19

big but i think i would put those

1:00:21

is some of the top things and a

1:00:23

lot of people working on batteries and trying to find

1:00:26

different chemistries for battery set would make

1:00:28

them more efficient and store electricity

1:00:31

for far longer appear to time

1:00:33

if you could

1:00:34

that us to spend a lot more political capital

1:00:37

mcapple occurred the job into

1:00:39

money and funding it could resolve into

1:00:42

changing laws can resolve into changing regulations

1:00:44

if your guests spend a lot more political capital

1:00:47

in something

1:00:49

that would speed decarbonisation

1:00:52

that you to get currently under utilized

1:00:54

but what if you've mentioned already here

1:00:56

you've mentioned permitting you mentioned what do you think we

1:00:59

don't give enough attention to that

1:01:01

of a real problem for the execution

1:01:03

of a rapid decarbonisation pathway

1:01:05

well i think permitting is is a very

1:01:07

important one and if you look at dub

1:01:10

like the international energy agency goal

1:01:12

for decarbonization by twenty thirty a

1:01:15

big part of that is removing replacing

1:01:17

coal generation electricity in asia

1:01:20

with natural gas we could actually

1:01:22

be exporting more natural gas

1:01:24

which is a hydrocarbon but we could displace

1:01:26

a lot of coal and i think that would be

1:01:29

one objectives the one thing that unites

1:01:32

renewable people and , and gas

1:01:34

people is that they're all very frustrated

1:01:36

by the permitting process just how long it takes

1:01:38

to get things done in the united states

1:01:40

and how long they spend in court since

1:01:43

moving to one regulatory agency after another

1:01:46

but i think the biggest thing biggest had thing

1:01:48

i force in energy are in d for the department

1:01:50

of energy's number of years ago and

1:01:53

i just come out thinking the most important thing

1:01:55

is the money spent on research and

1:01:57

development in and taking things out of the lab

1:02:00

that's what really pays off the covers it

1:02:02

doesn't pay off tomorrow but on

1:02:04

you know even the international energy agency said

1:02:07

to achieve the decarbonization goes by twenty

1:02:09

fifty after technologies

1:02:11

you need on a commercial basis don't exist today

1:02:13

so what we really need if i'm an optimist

1:02:16

about anything it's about technology innovation

1:02:19

to see what was seen happened was solar what happened

1:02:21

was sale and what we need to have happened

1:02:24

with new technologies to get to these goals

1:02:26

the gop good place to come to an end and so always

1:02:29

a final question what if we box you'd recommend

1:02:31

to be audience

1:02:32

the number one book i would recommend by far

1:02:35

as most relevant today is

1:02:37

food is world by angeles stand and

1:02:40

a subtitle is russia against the west

1:02:42

and with the rest and it

1:02:44

explains why india

1:02:47

brazil indonesia may other countries

1:02:49

abstained and the vote condemning russia

1:02:51

for the invasion of ukraine

1:02:54

, has also give you insight into what is

1:02:56

just check and global strategy

1:02:58

is so is think that's the think that's

1:03:00

of the day to read or because you get you to make

1:03:02

it is closer on the spot which is an amazing book

1:03:04

but i should have said fair enough

1:03:06

i should mention it is written by my wife angela

1:03:08

stance i really wish we could just

1:03:10

do a podcast of the conversations achieve

1:03:12

you must be having around the dinner table her health

1:03:15

oh it's very much her and these topics of

1:03:17

course the , books i

1:03:19

read his call it is a book title called

1:03:21

the power law in the subtitle is the

1:03:24

venture capital in the making of the new future

1:03:26

by sebastian mallaby mallaby

1:03:29

so much of what we have in the world today

1:03:31

and we take for granted you know the technologies

1:03:33

we use every day came out of venture capital

1:03:36

understanding how that system works and

1:03:38

what is and for the economy and innovation

1:03:41

it's very interesting it's it's very colorful

1:03:43

story the third book is

1:03:45

called the cloud revolution buy or sell

1:03:47

in a mark mills and it's about

1:03:50

have about convergence of new technologies

1:03:52

will create new technologies economic boom

1:03:55

when we see changes com things come

1:03:57

together and i he's focused

1:03:59

on around the cloud and

1:04:01

how it you know episode like what

1:04:03

happened will accrue city and radio and things like

1:04:05

that in the nineteen twenties

1:04:07

the new york and your book is are

1:04:10

you more recent book is the new map which is

1:04:12

startling and how relevant it is how much

1:04:14

it has on on russia ukraine how presently

1:04:16

a reads today people's had very much

1:04:18

check that out to understand the

1:04:21

layer of all of this it is that

1:04:23

it's energy base thank you very much

1:04:26

thank you as i really am glad

1:04:28

that this conversation

1:04:40

the ezra klein show is a production of new york

1:04:42

times opinion it has produced by rosie

1:04:44

karma any galvin and just

1:04:46

get this episode was

1:04:49

fact checked by michelle harris and

1:04:51

andrea lopez for saddam original

1:04:53

music by isaac jones mixing

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i just get our executive

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producer is irene the gucci special

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thanks to shannon busta and

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christina samuel loose