Page 6 - NorthAmOil Week 15 2021

NorthAmOil COMMENTARY NorthAmOil

Biden seeks to reshape

US energy landscape

US President Joe Biden’s recently unveiled infrastructure

plan seeks to make sweeping changes to the country’s

energy industry

US US President Joe Biden recently unveiled his Some industry commentators immediately
$2.25 trillion infrastructure plan, which would highlighted the oil and gas industry as one of
WHAT: bring about major changes for the country’s oil the major losers of the plan, owing to a heavy
US President Joe Biden and gas industry if it can proceed in its current focus on electric vehicles (EVs), which would
recently unveiled his form. However, aspects of the plan appear set to depress demand for refined fuels if it plays out
infrastructure plan, which be strongly resisted by the oil and gas industry, as as the Biden administration envisions.
would bring about major well as politicians that champion it. Compounding the oil and gas industry’s
changes in the country’s This week, Biden said he was prepared to bar- concerns, a tax plan released a week after the
energy sector. gain with lawmakers over changes to the plan, infrastructure plan and aiming to expand on it
which suggests that compromises will need to proposed eliminating subsidies claimed by oil
WHY: be made before it can be pushed through. None- and gas companies. Biden hopes to finance the
Biden has made theless, the impact of the plan on the oil and gas infrastructure plan largely through changes to
embracing the energy industry potentially stands to be significant. the corporate tax code – notably an increase in
transition a priority. corporate taxes. According to his tax proposals,
Changes eliminating oil and gas subsidies and raising
WHAT NEXT: As Biden has already made clear since taking levies on corporate polluters could boost gov-
Aspects of the plan are office in January, clean energy will be favoured as ernment revenues by $35bn over the coming
likely to be strongly he seeks to kick off the long process of decarbon- decade.
resisted by parts of the ising the US. This is evident in the infrastructure Despite these infrastructure and tax pro-
oil and gas industry, plan as well, with new tax incentives proposed posals, however, not everything in the plan is
and the politicians that for clean energy, electric transmission projects anticipated to have a negative impact on oil and
champion it. and carbon capture and storage (CCS) technol- gas companies. Under the infrastructure plan,
ogy. Investment bank Raymond James estimated Biden has earmarked $115bn for roads and
that $628bn – or about one-third of the package’s bridges, which would boost demand for asphalt.
price tag – related to climate or “green” aspects. Indeed, given that the material is derived from

US President Joe Biden
has already made clear
since taking office in
January that clean
energy will be favoured
under his tenure.

P6 www. NEWSBASE .com Week 15 15•April•2021