Biden Administration’s Oil and Gas Restrictions Drive Inflation and Higher Energy Costs, Says Energy Leader

Inflation and soaring energy costs are weighing heavily on the U.S. economy, and according to Harold Hamm, the chairman and founder of Continental Resources, a leader in the American energy renaissance, the blame lies with the Biden administration’s efforts to restrict oil and gas production on federal lands.

In a recent appearance on “Kudlow,” Hamm expressed his concerns about the negative impact of the administration’s decisions. “We need the moratorium taken off of federal lands, we’ve always developed federal lands,” he stated. Hamm pointed out that when President Biden put 26% of the U.S. landmass and about 35% of productive capacity off the table for oil and gas development, it led to an increase in inflation and higher costs for consumers.

Harold Hamm’s company, Continental Resources, played a pioneering role in developing fracking and horizontal drilling techniques, which significantly enhanced the competitiveness of the U.S. energy industry on the global stage.

Shortly after taking office, President Biden signed executive orders imposing a moratorium on new oil and gas leases on federal lands and offshore waters. This decision was met with legal challenges, leading the administration to allow new leases under a revised program with higher royalty payments to the government.

Furthermore, the administration also suspended operations on issued leases, along with implementing a moratorium on new leases in the Arctic National Wildlife Refuge (ANWR), pending an environmental review. A draft of this review is expected to be released in the third quarter of 2023.

Hamm emphasized that the higher costs triggered by these measures are persistent and do not go back down. He warned that once inflation is driven up, it remains “very resilient” and sticks, burdening consumers and the economy at large.

When asked about the ideal oil price to stimulate investment in the sector, Hamm responded that oil should be priced around $80 per barrel. He explained that this price point is necessary to encourage ongoing investment in oil and gas production. As of Wednesday, oil prices hovered around $80 a barrel, with U.S. crude futures closing at $79.49 a barrel and Brent crude futures closing at $83.20 a barrel.

Recent data from the Energy Information Administration revealed that U.S. crude oil inventories experienced a substantial decline of 17 million barrels, the largest drop in records dating back to 1982. The reduction was attributed to increased refinery runs and robust crude oil exports.

The debate over oil and gas production on federal lands continues to be a contentious issue, with proponents of the restrictions emphasizing environmental concerns and the need to transition towards renewable energy sources. On the other hand, critics, like Harold Hamm, argue that these restrictions are negatively impacting the economy and driving up costs for American consumers. As the Biden administration proceeds with its energy policy, finding a balance between environmental sustainability and economic growth remains a key challenge.