After campaigning on reining in oil and gas companies and curbing climate change, President Joe Biden is scrambling to find ways to lower energy prices — and counting on help from the industry.
The average per-gallon price of gasoline stands at $3.29 nationally, the highest level in seven years. Oil is also at its highest price in that time frame. Rising natural gas prices are expected to raise heating bills by about 30% this winter. With general inflation also high and dragging down Biden’s approval ratings, rising energy prices are a threat to the president’s agenda.
Biden has already been forced to ask global oil producers in OPEC+ to increase output to boost global supply in hopes of lowering costs. And this week, the White House has been reportedly consulting with the oil and gas industry about lowering prices — an industry whose footprint Biden has sought to shrink.
The issue is a precarious one for Biden, who argued during his campaign that the nation needs to get away from oil — but is now seeking more of it.
“I would transition away from the oil industry, yes,” Biden said in October 2020. “The oil industry pollutes, significantly. … It has to be replaced by renewable energy over time.”
And while Biden faces pressure to deliver immediate relief at the pump, a vocal contingent of the Democratic base is pushing him harder to cut off operational pipelines and develop fossil fuel projects that support domestic oil and gas supply.
Activists have been staging protests and marches outside the White House in recent days as part of “People vs. Fossil Fuels” week. One activist said she came to Washington to tell Biden to “start living up to [his] word” on climate issues.
Apart from the Keystone XL pipeline, the Biden administration has been reluctant to stop fossil fuel infrastructure projects, frustrating liberal activists.
Although Biden isn’t moving quickly or aggressively enough for activists, both the president and his party are doing plenty in the name of addressing climate change that runs counter to oil and gas interests, making the pursuit of an immediate solution to high gas prices trickier.
On his first day in office, Biden canceled the permit for Keystone XL, which would have delivered oil from Canada to refineries on the Gulf Coast of Texas.
He went on to order a pause on new oil and gas leases on federal lands days later. A federal judge lifted the pause in the summer, and the administration has resumed leasing while it appeals the ruling.
Democrats are also pursuing a fee on methane emissions for oil and gas operations, and their proposed clean electricity payment program would force the power sector’s hand to move away from fossil fuels.
Those decisions and the administration’s overall policy thrust have sparked fierce pushback from Republicans and oil and gas industry leaders, who have blamed Biden and Democrats for compromising U.S. energy independence.
“By pursuing policies that restrict supply and make it harder to produce oil and natural gas here in America, Americans will have to pay more for their energy,” American Exploration and Production Council CEO Anne Bradbury said in a statement Wednesday.
Bradbury went on to say the oil and gas producers “stand ready” to help the administration meet the challenge but insisted “the world cannot address climate change without being realistic about growing global energy demand.”
“To ensure we have a stable and affordable supply of energy here in the United States, the Biden Administration should support the domestic production of oil and natural gas, ensure the continued production on federal land, work with the industry on sensible and smart methane regulations, and stop calling for higher taxes on the American oil and gas industry,” she said. “Stopping pipelines, slowing permitting, raising taxes, and increasing regulatory burdens will only drive-up costs, and hurt American jobs.”
The administration has generally deflected blame for higher energy costs, especially as it relates to the oil and gas leasing pause.
“The production has stayed at levels consistent with past administrations. The pause did not impact ongoing permitting on legally held leases, so that has continued, and the jobs associated with that have continued,” Laura Daniel-Davis, principal deputy assistant secretary for land and mineral management at the Interior Department, said during a recent Senate hearing.
The current energy crunch is a global one, driven by a rapid rebound in demand as economies recover, and there is also some measure of recognition across party lines that Biden has little to do with it.
“No objective person is going to blame the administration for the current global energy crisis,” George David Banks, the former top international energy adviser for President Donald Trump, told the Washington Examiner.
The White House declined to offer hard details on what actions the administration plans to take next to bring down gas prices.
As we have said, we are closely monitoring the cost of oil and the cost of gas Americans are paying at the pump. And we are using every tool at our disposal to address anti-competitive practices in U.S. and global energy markets to ensure reliable and stable energy markets,” a White House official said in a statement.
Energy Secretary Jennifer Granholm has offered some detail, saying recently that “all tools are on the table” as the administration seeks to lower prices, including the release of crude oil from the national Strategic Petroleum Reserve.
