Fossil Fuel Fascism: How Oil Capital Captured the US State

Analysis of: The American epoch of oil is collapsing. What comes next could be ugly
The Guardian | May 17, 2026

TL;DR

The US is waging wars and gutting climate policy to prop up a dying oil industry, while China dominates the renewable energy future. This is fossil fuel fascism: billionaire-backed violence to delay an inevitable energy transition at workers' and the planet's expense.

Analytical Focus:Class Analysis Historical Context Contradictions

This article documents a striking example of state capture by a specific fraction of capital—the fossil fuel industry—which has effectively subordinated US foreign and domestic policy to its narrow profit interests. The Trump administration's aggressive promotion of oil, gas, and coal, combined with military interventions in Venezuela and Iran, represents not aberrant policy but the logical endpoint of petrostate capitalism in crisis. Campaign contributions exceeding $450 million, regulatory appointments drawn directly from industry ranks, and $18 billion in new tax incentives reveal how thoroughly capital has colonized the state apparatus. The historical parallel to British imperial decline is apt: just as coal-powered Britain fell to oil-powered America, the US petroleum economy is being superseded by China's electrostate model. This transition represents a fundamental shift in the material basis of global power. China's $2.2 trillion clean energy sector—now 11.4% of GDP—provides both energy independence and export dominance, while US policy actively destroys its own competitive position. The cancellation of $22 billion in clean energy projects and 38,000 manufacturing jobs eliminated in 2025 alone demonstrates how clearly fossil capital is willing to sacrifice national economic interests for sectoral profits. The article's concept of 'fossil fuel fascism' captures something essential: when an industry's product becomes economically obsolete but politically dominant, maintaining markets requires increasing levels of coercion. The suppression of climate science, attacks on press freedom, military interventions to secure oil supplies, and violent repression of domestic protest all follow logically from this contradiction. The petroleum industry cannot win the economic argument—renewables are now demonstrably cheaper—so it must win through force, disinformation, and state violence. This represents a particularly dangerous phase of capitalist crisis, where a dying fraction of capital threatens to bring down democratic institutions and environmental stability rather than accept its historical obsolescence.

Class Dynamics

Actors: Fossil fuel executives and shareholders (petroleum bourgeoisie), Tech oligarchs (Musk, Bezos), Chinese state-industrial complex, Working class consumers bearing energy costs, Clean energy workers facing layoffs, Petrostates (Saudi Arabia, Qatar, Russia), Military-industrial complex

Beneficiaries: US petroleum industry executives and shareholders, Defense contractors, Russian, Saudi, and Qatari petrostates, Fossil fuel-backed political figures, Gulf monarchy ruling families

Harmed Parties: American workers paying higher energy costs, 38,000+ clean energy workers who lost jobs, Victims of Iran war and Venezuela invasion, Global populations facing climate catastrophe, Scientists and journalists facing suppression, Domestic protesters facing state violence

The article documents a textbook case of regulatory capture where the petroleum fraction of capital has achieved near-total control over the US state apparatus. This includes direct personnel appointments from industry to government, massive campaign financing, and the subordination of military policy to fossil fuel market management. The power relation is asymmetric: concentrated fossil capital exercises direct political power, while dispersed working-class majorities who support climate action lack organizational vehicles to translate preferences into policy. China's state-capital arrangement operates differently—the Communist Party retains greater autonomy from individual capital fractions, allowing longer-term strategic planning in renewable investment.

Material Conditions

Economic Factors: Declining profitability of fossil fuels without artificial market support, Rising competitiveness of renewable energy (now cheapest electricity in history), China's $2.2 trillion clean energy sector (11.4% of GDP), US clean energy job losses (38,000+ in 2025), $22 billion in cancelled US renewable projects, Oil price dependence on military conflict, Critical mineral supply chains controlled by China

The core tension is between two modes of energy production: the established petroleum industry characterized by concentrated ownership, enormous sunk capital costs, and dependence on continuous extraction; versus distributed renewable production with lower marginal costs and different capital requirements. The fossil fuel industry's response to this competitive threat has been to leverage its accumulated political capital—built over a century of petrodollar dominance—to secure state subsidies, military protection of markets, and suppression of alternatives. China's different ownership structure, with greater state coordination, has allowed it to manage the transition more strategically, treating renewables as a state priority rather than a threat to incumbent capital.

Resources at Stake: Venezuelan oil reserves (world's largest), Iranian petroleum supplies (fourth largest), Critical minerals for batteries and technology, Gulf oil transport routes (Strait of Hormuz), Global electricity generation market share, EV and battery manufacturing capacity, AI datacenter energy supply

Historical Context

Precedents: British Opium Wars and coal-powered imperial dominance, 1956 Suez Crisis marking US ascendancy over British/French empires, US interventions in Iraq, Kuwait, and Middle East oil regions, Standard Oil's historical market manipulation, OPEC oil shocks of 1973 and 1979, Petrodollar system established 1970s

The article situates current events within a long historical pattern where shifts in dominant energy sources precipitate geopolitical realignments. The 19th-century transition from agrarian to coal-based production enabled British global dominance; the 20th-century shift to petroleum elevated the US. Each transition has involved violence as declining powers attempt to arrest their fall. The current moment represents late-stage petrostate capitalism in crisis—the US has exhausted the productive potential of oil-based accumulation but lacks the political capacity to transition due to fossil capital's capture of state institutions. This is characteristic of what Marxist theorists call a 'structural crisis of accumulation,' where the dominant faction of capital can no longer reproduce itself through normal market mechanisms and must rely increasingly on extra-economic coercion.

Contradictions

Primary: The fundamental contradiction is between the declining economic viability of fossil fuels (now more expensive than renewables) and the continued political dominance of fossil capital. This creates a situation where state policy actively undermines national economic competitiveness to serve sectoral interests—a contradiction that cannot be resolved within the current political framework.

Secondary: Contradiction between 'energy dominance' rhetoric and actual US energy dependence on imported commodities, Contradiction between free market ideology and massive fossil fuel subsidies, Contradiction between democratic legitimacy claims and suppression of majority opinion on climate, Contradiction between national security discourse and policies that weaken US technological competitiveness, Contradiction between anti-China rhetoric and policies that accelerate Chinese global leadership

Three possible trajectories emerge: (1) Continued fossil fuel fascism with escalating authoritarianism domestically and military aggression internationally as contradictions intensify; (2) Electoral/judicial constraints force partial policy reversal, though underlying structural capture remains; (3) Economic crisis as US falls further behind in clean energy makes fossil fuel strategy untenable, forcing transition under worse conditions. The article suggests the fundamental contradiction—economic obsolescence versus political power—cannot persist indefinitely. Either the political superstructure will adapt to the new economic base, or the friction between them will generate increasingly destructive outcomes. Climate breakdown itself becomes a material force that ultimately renders fossil fuel dominance physically impossible.

Global Interconnections

This analysis reveals how energy transition operates as a driver of inter-imperialist rivalry and potential hegemonic shift. China's clean energy dominance is not simply a technological achievement but a strategic repositioning in the global division of labor—from workshop of the world to supplier of 21st-century infrastructure. The US response demonstrates how declining hegemonic powers resort to military force when economic competition fails. The invasions of Venezuela and Iran are not primarily about 'freedom' or 'nuclear weapons' but about maintaining control over fossil fuel supplies that would otherwise flow to China and other rising powers. The global South emerges as the key terrain of this competition. Chinese clean energy exports make solar and EVs affordable for African and Latin American countries, offering a development path with less dependence on US-controlled petroleum markets. This represents a potential restructuring of the core-periphery relations that have characterized imperialism for centuries. The article's observation that former US allies are seeking 'balancing relationships' with China signals the beginning of a multipolar transition, with energy infrastructure as the material basis for new alignments.

Conclusion

This article documents a historical inflection point where fossil capital's desperate rearguard action against economic obsolescence has captured the US state and turned it toward fascistic methods—disinformation, violent repression, imperial war—to preserve markets that would otherwise collapse. For working people, the implications are clear: the same forces profiting from climate destruction are those suppressing wages, busting unions, and militarizing borders. The connection between environmental and labor struggles is not abstract—it is embedded in the same class interests that benefit from both fossil fuel extraction and labor exploitation. The path forward requires building the organizational capacity to translate majority preferences (for climate action, for peace, for economic justice) into political power capable of overcoming capital's structural advantages. The contradictions are sharpening; the question is whether workers will be organized to seize the opportunities they create.

Suggested Reading

• Imperialism, the Highest Stage of Capitalism by V.I. Lenin (1917) Lenin's analysis of how finance capital drives imperial expansion for markets and resources directly illuminates the US wars in Venezuela and Iran as efforts to secure fossil fuel supplies against declining economic competitiveness.
• The Shock Doctrine by Naomi Klein (2007) Naomi Klein's documentation of how crises are manufactured and exploited to impose unpopular policies provides essential context for understanding how the Iran war serves to restructure energy markets and suppress climate action.
• Blackshirts and Reds by Michael Parenti (1997) Parenti's analysis of how capitalist interests have historically allied with fascist movements when facing systemic threats illuminates the article's concept of 'fossil fuel fascism' and the class forces driving authoritarian responses to energy transition.
• Less Is More: How Degrowth Will Save the World by Jason Hickel (2020) Hickel's analysis of the structural impossibility of infinite growth on a finite planet provides theoretical grounding for understanding why fossil capital's position is ultimately untenable regardless of political machinations.