US says 'no plans to restart Keystone XL oil pipeline' even as Russian supply halts

After the premiere of Alberta, Canada urged the President Joe Biden-led US administration to resume the construction of the Keystone XL pipeline backed by former President Donald Trump, White House spokesperson Jen Psaki said on Wednesday, March 9, that the US has “no plans” to restart the project. "There are no plans for that and it would not address any of the problems we're having currently," Psaki said during a press briefing.

She was asked about possibly re-authorising the Keystone XL pipeline by a reporter as Washington sanctioned the Russian oil supply and had no apparent alternate supplier at this time. 

"If we’re trying to bring about more supply that does not address any problem," Psaki said. 

"The pipeline is just a delivery mechanism – it’s not an oil field, so it does not provide more supply into the system. There’s no plans for that, and it would not address any of the problems we’re having currently,” Biden’s press secretary added. 

US must restart the long-disputed Keystone XL oil pipeline: Canada

As concerns about the gasoline price hike and volatility in the energy market grew due to the Russia-Ukraine war’s impact on oil, Canadian Premier Jason Kenney had said at a press conference that the US must restart the long-disputed Keystone XL oil pipeline proposed in 2008. The incoming US President Joe Biden had revoked the 1,700-mile (2,735-kilometer) pipeline’s permit on his first day in an office which could run an estimated 800,000 barrels of oil a day from Alberta to the Texas Gulf Coast, passing through Montana, South Dakota, Nebraska, Kansas and Oklahoma.

“Leaving the Keystone XL pipeline permit in place would not be consistent with my Administration’s economic and climate imperatives,” Biden had said. 

(Pipes to be used for the Keystone XL pipeline are stored in a field near Dorchester, Neb; Image: AP)

Renewing his calls for starting the project again, Premier Jason Kenney said: ”If the United States is serious about this, they could come back and help us build Keystone XL.” He continued, “If President Biden had not vetoed that project, it would be done later this year – 840,000 barrels of democratic energy that could have displaced the 600,000 plus barrels of Russian conflict oil that are filled with the blood of Ukrainians." 

The Canada US Keystone oil pipeline pumps from Alberta crude oil in the Canadian town of Hardisty and transports it to refineries in the US states of Illinois, Oklahoma and Texas. While the three phases of the system are currently operational, the fourth labelled as Keystone XL was halted prompting anger and backlash on the Canadian side that decried 1,000 jobs losses. Premier of the oil-rich Canadian province of Alberta had called Biden’s decision an “insult” and lawmakers pushed the Justin Trudeau government to impose trade sanctions on the US. 

“We are disappointed but acknowledge the President’s decision to fulfil his election campaign promise on Keystone XL,” Trudeau had said. 

As US president Biden announced a ban on all imports of Russian oil, he had categorically stressed that he was targeting the "main artery" of Russia's economy—oil shipments and revenue. However, speaking at a presser from the White House, Biden warned that the ban would hit the American families.

"Putin's war is already hurting American families at the gas pump since Putin began his military buildup on Ukrainian borders," Biden had said, adding, "And with this action, it's going to go up further. I'm going to do everything I can to minimise Putin's price hike here at home in coordination with our partners.” 

German Chancellor Olaf Scholz in Europe, chose a different tone. He said that his country would not cut off Russian oil and gas imports. “At the moment, Europe’s supply of energy for heat generation, mobility, power supply and industry cannot be secured in any other way,” said Scholz at a press briefing. 

Gas price in US hit record $4.17 per gallon

Gas prices on Wednesday rose sharply across the US hitting a record $4.17 per gallon, according to o Oil Prices Information Service, AAA. The oil prices broke the previous record of $4.11 a gallon of July 2008 in the US, and the price rise caused by Hurricane Katrina damaging oil platforms and refineries along the US Gulf Coast in 2005. Overall the oil prices rose 18% since February 24 when Russia invaded Ukraine as it is one of the world's major oil exporters and caters to the largest output across all of Europe and Asia.

Washington's desperate attempts to arrange calls with oil-rich gulf nations Saudi Arabia and UAE was declined by Saudi Arabia’s Crown Prince Mohammed bin Salman and the United Arab Emirates (UAE) Sheikh Mohammed bin Zayed al Nahyan over strained ties. UAE’s Ministry of Foreign Affairs clarified that the requested call between POTUS and Sheikh Mohammed was being “rescheduled”. Bilateral relations between the Biden administration and Saudi de facto ruler Crown Prince Mohammed bin Salman worsened after Washington’s report on the Yemen war, and the 2018 murder of Saudi journalist Jamal Khashoggi.