We are all paying more for petrol because the free world has turned away from developing its resources. Instead, some countries have decided to get their resources from autocratic dictatorships. Now that some of those, like Russia, are acting like dictators we have a massive shortage of almost all key commodities including oil.
There is the absurd situation that Europe is unified at opposing Russia's aggression yet it continues to import 40 per cent of its gas from Russia. And this gas is transported to Europe through pipelines that run over the Ukrainian battlefront. Given the higher oil prices, some estimates show that Europe might be paying Russia over $6 billion a week for gas now.
Europe's vulnerable state has not been caused by Russia, it has been a self-inflicted wound. Europe's gas production has fallen by 30 per cent over the past decade, while their gas consumption has only fallen by 13 per cent. They have made the gap up by importing more gas from Russia even though Europe has more gas reserves than Australia. Europe has made a policy decision not to frack or drill for gas.
Europe has not developed its own gas because environmental activists have successfully pressured governments and investors not to support its development. Seven different European countries have banned fracking following political campaigns.
In the aftermath of one such campaign, a Member of the Romanian Parliament, Iulian Iancu, claimed that Russia had spent $120 million campaigning against fracking. In 2014, the Secretary-General of NATO, Anders Fogh Rasmussen said that Russia "engaged actively with ... environmental organisations working against shale gas — to maintain dependence on imported Russian gas."
Even Hillary Clinton has raised concerns of Russia's campaign against gas developments in the west.
Vladimir Putin has claimed that fracking "poses a huge environmental problem" and that places that have allowed it "no longer have water coming out of their taps but a blackish slime." He has an agenda to stop western countries becoming self-sufficient.
Some suggest that we should just rid ourselves of our oil and gas demands and shift to renewables. With the world in crisis we need policies based on facts not fashions. Fortunately, the International Energy Agency (IEA) outlined the facts this week.
According to the IEA, Europe imports 155 billion cubic metres (bcm) of gas from Russia every year. The IEA proposed a 10 point plan that could reduce Europe's demand for Russian gas by a third, of course that would leave Europe still importing more than 100 billion cubic metres of gas from Russia each year.
The IEA's plan to reduce Europe's gas imports from Russia includes increasing LNG imports, deferring closure of nuclear plants, increasing EU gas production and not heating homes to as high a temperature.
Fast tracking renewable energy would save Europe just 6 bcm per year, or less than 5 per cent of Europe's gas imports from Russia. If you think we can defeat Putin by building wind and solar, you might just be amplifying Russian funded propaganda.
Buried at the end of the IEA's report is the kicker. There, the IEA admits that turning on Europe's mothballed coal fired power stations "could displace large volumes of gas relatively quickly." Yet, curiously this option is not included in their 10-point plan because it "would raise the EU's emissions."
I am sure that Ukrainian families cowering in Kiev's subways find solace in the principle that Europe won't do anything to jeopardise its net zero emissions commitments.
In the real world we need to produce more coal, oil and gas to bring down energy prices. We are lucky in Australia to have abundant amounts of all of these and the best way we can help the brave Ukrainian people is to increase our production of energy. Therefore, helping to take away the lifeline that is funding Putin's barbaric war.