Trump’s Loyalty to Fossil Fuel Companies Is Driving Up Inflation

Throughout his second term, President Donald Trump has been on a relentless push to boost fossil fuels, undermine renewable energy, and end all federal regulation to address climate change. The administration claims that this push will help people in the U.S. save money.

But in reality, the opposite is true: Fossil fuel dependence makes life more expensive.

Global Price Shock

Thanks to the U.S.-Israeli war on Iran, crude oil prices are soaring — leading to sky-high prices for gasoline and diesel. With that war, Trump has set off a domino effect, showing how deeply the fossil fuel industry has baked its prices directly into the U.S. economy.

For example, the price of food had already been increasing before the U.S. began its war. But now, economists have said that trend upwards will continue in coming months. One reason for that is the price spike for fertilizers. Chemical fertilizers providing nitrogen, an essential plant nutrient, are made using natural gas. And around 10 percent of the world’s supply of urea, a common nitrogen fertilizer, comes from the Middle East — and is impacted by the closure of the Strait of Hormuz. Additionally, because most food products are distributed using diesel-powered trucks, we’re seeing the impact of diesel prices on rising food prices in real time.

Trump’s unprovoked war would have been a disaster in any context. But people in the U.S. and worldwide, especially in the Asia-Pacific region and in Africa, would have felt a whole lot less economic pain if we hadn’t been so dependent on oil and gas in the first place. Experts forecast that the worst impacts are yet to come.

The Federal Reserve Bank of Dallas said back in March that a prolonged closure of the Strait of Hormuz could cause a global economic downturn. Now, two months later, the World Bank is forecasting the possibility of an additional 45 million people worldwide facing acute food insecurity, and significantly higher inflation and slower economic growth in developing economies. But even if the Strait were to open tomorrow, idled oil wells and refineries will take time to restart, leading to a severe supply crunch and further price increases.

Expensive Electricity

Another example of fossil-fueled inflation is the surge in residential electric bills. Fracked gas is the largest energy source for electric power generation in the U.S. But since the start of the fracking boom in the early 2000s, U.S. producers are increasingly producing gas for export. Consequently, gas prices — and our utility bills — are exposed to increased global price volatility.

The proliferation of energy-hungry AI data centers is another factor driving up electric bills. Besides their direct impact on utility bills, data centers are also causing growth in gas-fired power generation, leaving rate payers even more susceptible to gas price spikes. Yet the Trump administration has made it a national policy priority to promote AI technology.

Meanwhile, renewable wind and solar energy, which are the cheapest sources of energy worldwide, provide only about 20 percent of electricity in the U.S. Yet the Trump administration is using legally questionable methods to actively block new renewable energy from being built, locking in our dependence on expensive fossil fuels.

Climate Change Is Costly

It’s not just the fuels themselves that are making everything more expensive. It’s also the effects of digging them up and burning them.

Rising atmospheric greenhouse gas levels are leading to expensive wildfires, storms, and floods. The cumulative cost of climate disasters has increased sharply; the last three calendar years have had the highest total disaster costs over the entire 45-year period covered by the Climate Central database of billion-dollar weather and climate disasters in the U.S. Some of these costs are picked up by taxpayers through government-funded recovery, some are borne by insurance companies, and some are shouldered by impacted people.

Of course, this is just scratching the surface.

These disasters are raising home insurance premiums in disaster-prone regions. And because lenders require an adequate home insurance policy as a condition for a mortgage, rising insurance premiums effectively make homeownership unaffordable for many.

Prolonged droughts, severe floods, and other extreme weather events exacerbated by climate change also impact food production and drive up food prices. Drilling and fracking for oil and gas contaminates drinking water, leading to all kinds of costs for households. These include medical bills for cancer and other serious illnesses from drinking contaminated water, and the cost of having to buy bottled water instead of using contaminated tap water or well water.

Burning fossil fuels also pollutes the air, potentially causing cancer, respiratory diseases, and other illnesses. Particulate matter and ozone pollution from vehicle tailpipes alone was responsible for 385,000 deaths and $1 trillion in health damages worldwide in 2015.

So the next time any political figure — whether they’re a member of the Trump administration or a feckless fossil-fueled Democrat — tells you that they’re clinging to the fossil energy status quo to save you money, don’t believe them.

They are protecting the profits of a powerful industry, at our expense. And the sooner we transition off fossil fuels, the healthier we — and our economy — will be.