Biden Walking “Tightrope” on Oil and Gas Drilling

Biden Walking “Tightrope” on Oil and Gas Drilling

July 14, 2021

It’s hard to find good things to say about the Biden administration’s energy policies, but there was a silver lining this week. According to an Associated Press analysis released yesterday, the Interior Department approved 2,500 requests to drill for oil and gas on public land in the first six months of this year. That puts the Biden administration on pace for the largest number of permit approvals since the George W. Bush administration back in 2009.

Even with this news, we know the Biden administration is no fan of fossil fuels. They had previously sought to suspend new oil and gas leases on federal lands, but that was blocked by a judge last month. The pause on new lease sales doesn’t stop companies from obtaining permits to drill on existing leases and many approved drilling requests are happening on federal land that was already under lease during the Trump administration. We also remember President Biden’s quick action to cancel the much-needed Keystone XL pipeline from Canada. Still, these approvals demonstrate that even the Biden administration recognizes the importance of affordable energy.  As the Associated Press reported:

Further complicating Biden’s climate agenda is a recent rise in gasoline prices to $3 a gallon ($0.79 a liter) or more in many parts of the country. Any attempt to limit petroleum production could push gasoline prices even higher and risk souring economic recovery from the pandemic.

“He’s walking the tightrope,” said energy industry analyst Parker Fawcett with S&P Global Platts, noting that Keystone and ANWR came without huge political costs because they were aimed at future projects.

“Those easy wins don’t necessarily have huge impacts on the market today,” Fawcett said. “He is definitely backing off taking drastic action that would rock the market. … What you’re going to see is U.S. oil production is going to continue to rebound.”

Haaland has sought to tamp down Republican concern over potential constraints on the industry. She said during a House Natural Resources Committee hearing last month that there was no “plan right now for a permanent ban.”

“Gas and oil production will continue well into the future and we believe that is the reality of our economy and the world we’re living in,” Haaland told Colorado Republican Rep. Doug Lamborn.

The Biden administration is indeed walking a tight rope. While their intention of limiting oil and gas production is clear, it is equally clear that they want to avoid any actions that can be easily or directly linked to increasing energy prices. Unfortunately, their long-term goals will bring long-term pain in the form of higher gas and electricity prices for American families and businesses.