The Biden administration is delivering “a barrage of negative rhetoric” about oil and gas development that’s dampening domestic production of the fossil fuels, the head of the industry’s top lobbying group told policymakers, executives and other officials in the nation’s capital Wednesday.
(Bloomberg) — The Biden administration is delivering “a barrage of negative rhetoric” about oil and gas development that’s dampening domestic production of the fossil fuels, the head of the industry’s top lobbying group told policymakers, executives and other officials in the nation’s capital Wednesday.
Instead of promoting real solutions to bolster US energy security, the administration has sought to restrict production while tapping the nation’s emergency crude stockpile and asking other countries to supply more, American Petroleum Institute President Mike Sommers said in his annual address.
The comments underscore still-simmering tension between the oil industry and the Biden administration at the start of a new year marked by many of the same challenges as seen in 2022, including war-strained energy supplies and curtailed refining production capacity.
President Joe Biden has routinely blasted the industry, blaming executives for stifling investments in new production and even accusing them of collecting a windfall from the war in Ukraine as gasoline prices climbed last year.
On his first day in office Biden revoked a presidential permit for the Keystone XL pipeline and days later imposed a moratorium on new federal oil and gas leasing (though the Inflation Reduction Act has since forced some auctions). He’s also relentlessly encouraged a shift away from fossil fuels, with policies that promote electric vehicles and renewable energy.
US oil output was battered by the Covid pandemic that caused demand to crater but has slowly increased since Biden took office. US oil producers are set to pump a record 12.8 million barrels per day in 2024, according to the latest forecast from the Energy Information Administration.
However, Sommers said in an interview Tuesday, future growth — and America’s “strong energy position” — aren’t guaranteed and instead require support from policymakers and the industry itself.
Sommers decried current signals from Washington that he said are acting to discourage investment, alongside vows of capital discipline, even as the invasion of Ukraine and the end of China’s zero-Covid policy stoke demand for non-Russian supplies.
“Continuing to talk down the industry itself — saying this isn’t an industry we’re going to need a decade from now — does harm access to capital,” Sommers said in the interview.
“If the government signals support for American energy, it would boost investor confidence in future projects to unleash needed supplies and strengthen infrastructure,” he said in his Wednesday address.
“If the government signals support for American energy, it would boost investor confidence in future projects to unleash needed supplies and strengthen infrastructure,” he added.
As gasoline prices have ebbed along with political heat following the November midterm elections, Sommers said the industry now is having positive, regular dialogue with administration officials.
Read More: Biden Has Not Spoken With US Oil and Gas CEOs, Pioneer Boss Says
API is hoping to spur legislation to expedite permitting of energy projects after a previous effort backed by Senator Joe Manchin, a moderate Democrat from West Virginia, stalled last year.
In a report released Wednesday, the group faults “protracted and uncertain review processes” for constraining 10 major natural gas and oil infrastructure projects, with delays harming consumers from the Northeast US to Europe.
Both Democrats and Republicans have called for an overhaul of the way the government vets energy infrastructure — from pipelines to power lines — as lengthy reviews threaten to derail both renewable and fossil fuel projects. But there are deep divisions over how to accelerate project approvals without undermining protections for neighboring communities, wildlife and the environment.
Permitting reform represents the API’s top lobbying priority on Capitol Hill, even as the trade group works to encourage more access and a predictable plan for offshore lease sales, Sommers said.
(Updates with comments in 10th paragraph)
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