Publications: Notes at the Margin

The US Supremes: Voting for Low Oil Prices; Big Oil's Refinery Sales to Traders Accelerate Oil's Transformation (July 8, 2024)

 

The US Supreme Court’s recent decisions may dramatically change global fossil fuel markets. Initially, investments in and output from the US industry should surge. However, the increased supply will threaten price levels. Further, the emasculation of US environmental rules on oil and gas production, as well as the likely blocking of efforts to stop domestic methane emissions, will probably prevent US producers from exporting oil or natural gas to EU markets and some Asian markets. By late in this decade, US producers may have to accept much lower prices than producers in countries that comply with global emissions rules.

The court’s rulings, if extended to block the Environmental Protection Agency’s program to limit methane emissions, could drive a wedge of as much as fifty percent between prices offered for US oil and gas exports and those offered for exports from countries that comply with EU environmental standards and those of other nations working to reduce methane outgassing.

 

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