A Biden White House: Potential Policy Impact on the Oil & Gas Industry
If Joe Biden were to win the US presidential election, his administration is expected to take action on climate change and declare it a national emergency soon after taking office. What kind of action could we expect on oil and gas companies?
I believe Biden would be likely to cancel the presidential permit for the Keystone pipeline and cancel new lease rounds on federal lands. I do not think Biden’s administration would seek a fracking ban, even on federal lands, or cancel the Dakota Access Pipeline given the expensive legal challenges and liabilities associated with these moves. But I would expect a larger push for renewables and incentives for greener energies.
Oil and gas companies likely to withstand the pressure
Though climate-conscious policies aren’t favorable for oil and gas companies, these companies demonstrated their resilience during President Obama’s administration. I don’t believe a Biden administration would destroy the industry. That said, I believe tougher federal energy regulations could pressure the large major oil companies to diversify or change their business models. Federal regulations may also pressure state and regional economies dependent on federal lands used for oil and gas drilling.
The infographic below summarizes potential policy proposals under a Biden administration and highlights the states and regions facing the greatest potential federal regulatory changes.