The Biden administration announced this week that the U.S. is now back up to the level of domestic oil production (13 million barrels a day) that we achieved under Donald Trump. Never mind that in the next breath, he assures his green energy friends that we are weaning America off of fossil fuels and will pursue Net Zero oil and gas policies.
Well, which is it?
Our latest analysis of domestic oil production by CTUP and University of Chicago economist Casey Mulligan shows that production under Biden is running far below the Trump baseline – i.e. the amount of oil that would have been produced if we had stuck with Trump’s pro-drilling policies.
Depending on the assumptions made about the sensitivity of production to the rise in the price of oil and also the continued technological advances in shale oil production – which lower drilling costs – we would be producing at least one million more barrels a day and probably closer to four million.
If we take the midpoint estimate then Biden’s war on American energy is costing the U.S. economy at least $200 million each and every day from reduced domestic oil production. Somewhere an Arab oil Sheik is smiling.