Several major media networks have projected the victory of the Democratic candidate Joe Biden in the US presidential election. Below are some analysts predictions on the country’s energy policy under his administration:
Much like to his Democratic predecessors, Biden has shown some interests in multilateral diplomacy. This might result in an eventual end for US sanctions against Iran. Biden will likely resume the partnered approach between the US and European countries to address Iran’s nuclear program. For Venezuela, Biden is expected to keep the sanctions but might also intensify diplomatic efforts by negotiating for a new election or power-sharing with the opposition.
In his campaign, Biden has not specifically addressed how he would cope with these issues. The unilateral sanctions by the outgoing President Donald Trump have cut 3 million bpd of Venezuelan and Iranian crude out of the international market. This figure is equal to 3% of the global oil supply.
Unlike Trump, Biden has no close relationships with Saudi Arabia’s Crown Prince Mohammed bin Salman. The relationships proved to be crucial during the crash of oil prices caused by the coronavirus pandemic this year. Trump, through phone calls and even Twitter, managed to influence the cartel and engaged closely on its production policy. Biden has not also detailed how he would approach these issues.
Analysts expect that he would rely on other diplomatic channels to influence OPEC policy. Both Trump and Biden need moderate oil prices for customers. However, Biden will likely prefer them higher to make renewable energy more competitive and support his ambitious climate agenda.
In his campaign, Biden said he would ban fracking permits on federal lands and waters as part of his climate target. The US pumped almost 3 million bpd of crude oil from federal areas in 2019. Without permits, this figure would trend to zero in a matter of years.
Biden has pledged to cut the US emissions to zero by 2050, including by eliminating emissions in the energy industry to zero by 2035. He also vowed to rejoin the Paris Climate Accord, an international climate pact that Trump pulled away from, recently. Analysts said Bide would face hurdles to deliver these promises given the Republican-dominated Congress.
