Saudi Arabia recently came under…
Oil prices continued to climb…
U.S. President Joe Biden is expected to sign on Wednesday an executive order directing federal government agencies to determine the extent of a ban on new drilling on federal lands and waters, The New York Times reports, quoting two sources familiar with the President's upcoming executive orders.
The move to order the federal agencies to weigh in on the extent of a ban takes President Biden's 60-day moratorium on oil and gas permitting on federal lands and waters a step further.
Hours after taking office, President Biden's Administration suspended for 60 days oil and gas permitting on federal lands and waters, as part of a review into the policies of the previous administration and the push to green energy to fight climate change.
President Biden's move drew harsh reactions from the oil industry.
"Restricting development on federal lands and waters is nothing more than an 'import more oil' policy. Energy demand will continue to rise—especially as the economy recovers—and we can choose to produce that energy here in the United States or rely on foreign countries hostile to American interests," American Petroleum Institute (API) President and CEO Mike Sommers said.
"We stand ready to engage with the Biden administration on ways to address America's energy challenges, but impeding American energy will only serve to hurt local communities and hamper America's economic recovery," Sommers noted.
The biggest U.S. oil producers operating on federal land have years' worth of drilling permits and don't expect much to change in the short to medium term. The small independent shale drillers, however, especially those that have a large part of their operations coming from federal lands, are concerned, and some think that the U.S. Administration banning new federal lease sales could pose an "existential threat" to their companies.
Some states could also be much more impacted than others—in New Mexico, for example, 65 percent of the state's oil and gas production takes place on federal land.
By Charles Kennedy for Oilprice.com
More Top Reads From Oilprice.com:
Charles is a writer for Oilprice.com