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WASHINGTON, DC - NOVEMBER 23: U.S. President Joe Biden speaks on the economy during an event at the South Court Auditorium at Eisenhower Executive Office Building on November 23, 2021 in Washington, DC. President Biden announced the release of 50 million barrels of oil from the Strategic Petroleum Reserve of the Department of Energy to combat high energy prices which are at a seven-year high across the nation prior to the holiday travel season. (Photo by Alex Wong/Getty Images)

Biden Admin’s New Oil-Gas Leasing Reforms Will Further Raise Consumer Costs

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The Biden Administration’s Interior Department has released long-awaited reform recommendations for the way in which oil and gas leases are granted to oil companies, and they aren’t likely to be well-received by a majority of American consumers because they are expected to raise costs on fossil fuel production.

The Associated Press reported Friday:

The Biden administration on Friday recommended an overhaul of the nation’s oil and gas leasing program to focus on areas that are most suitable for energy development and raise costs for energy companies to drill on public lands and water.

The long-awaited report by the Interior Department stops short of recommending an end to oil and gas leasing on public lands, as many environmental groups have urged. But officials said the report would move toward a more responsible leasing process that provides a better return to U.S. taxpayers for oil and gas drilling on the nation’s vast public lands and waters.

The recommendations come as American drivers are paying some of the highest gasoline prices in years, after they fell to extremely low levels under former President Donald Trump, whose policies also led to U.S. energy independence for the first time since last century.

“Our nation faces a profound climate crisis that is impacting every American,″ said Interior Secretary Deb Haaland in a statement, noting that the report’s recommendations will mitigate climate change and give taxpayers a better return “while staying steadfast in the pursuit of environmental justice.”

Biden’s original order, dated Jan. 27 — about a week after he took office — reads:

To the extent consistent with applicable law, the Secretary of the Interior shall pause new oil and natural gas leases on public lands or in offshore waters pending completion of a comprehensive review and reconsideration of Federal oil and gas permitting and leasing practices in light of the Secretary of the Interior’s broad stewardship responsibilities over the public lands and in offshore waters, including potential climate and other impacts associated with oil and gas activities on public lands or in offshore waters.  

The Secretary of the Interior shall complete that review in consultation with the Secretary of Agriculture, the Secretary of Commerce, through the National Oceanic and Atmospheric Administration, and the Secretary of Energy.  In conducting this analysis, and to the extent consistent with applicable law, the Secretary of the Interior shall consider whether to adjust royalties associated with coal, oil, and gas resources extracted from public lands and offshore waters, or take other appropriate action, to account for corresponding climate costs.

“The moratorium drew sharp criticism from congressional Republicans and the oil industry, even as many environmentalists and Democrats said Biden should make the leasing pause permanent,” the AP reported.

The new recommendations for federal oil and gas leases come amid a dramatic price spike in fuels, especially gasoline. Republicans and oil companies say those price increases are directly tied to the president’s decisions to pause news leases on taxpayer-owned land, cancellation of the Keystone XL pipeline, and an outright ban on oil leasing in Alaska’s Arctic National Wildlife Refuge.

The political fallout of higher prices at a time when the cost of many other consumer goods have also risen dramatically likely led Biden to order the release of a historic amount of oil from the U.S. Strategic Reserve — 50 million barrels — in an effort to cool prices. At about $3.40 per gallon on average, pump prices are roughly 50 percent more than they were a year ago, the American Automobile Association (AAA) noted.

“The Biden administration conducted a lease sale on federal oil and gas reserves in the Gulf of Mexico last week, after attorneys general from Republican-led states successfully sued in federal court to lift a suspension on federal oil and gas sales that Biden imposed when he took office,” the AP reported.

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