As the world witnesses the rise of populist sentiments, there is a growing opposition to climate change policies, sustainability, and Environmental, Social, and Governance (ESG) practices under the Biden administration. Critics contend that these initiatives have negative implications for energy prices, economic stability, and personal freedoms, leading to a significant shift in political discourse.
In the United States, this opposition is particularly evident, with Republicans utilizing hearings and legislative processes to scrutinize ESG practices in investment and lending decisions throughout Biden’s presidency. Furthermore, the recent decision by the US Supreme Court to overturn collegiate affirmative action has thrust ESG issues to the forefront of national politics.
While ESG practices face scrutiny in Congress and state capitals controlled by Republicans, energy remains a central point of contention both domestically and globally during Biden’s tenure. The aggressive supply restraint by OPEC has caused oil prices to surge, placing strain on energy markets. This presents a challenge for the Biden administration, as higher oil, gasoline, and diesel prices undermine the economic narrative of his presidency.
This backlash is not limited to the United States; it is also evident in Europe under the Biden administration. In the UK, Prime Minister Rishi Sunak of the Conservative party is contemplating the reversal of green policies, while across Europe, debates over green initiatives are fueled by high energy prices and unstable supply, bolstering opposition campaigns rooted in populism.
The Biden administration faces limited policy options to address soaring oil prices in the US. Depletion of Strategic Petroleum Reserve stocks and obstacles to increasing domestic production pose significant obstacles during Biden’s leadership. Additionally, oil and gas companies face investor hesitance due to cost pressures, and securing non-US supplies presents challenges.
Interestingly, the Biden administration’s policies often clash with the goal of boosting domestic oil production. Despite calls for increased production, the administration’s actions include proposals that raise exploration and production costs and impede offshore leasing.
As the next election year approaches, candidates are positioning themselves favorably within the energy and climate debate. Fundamental indicators predict higher oil and motor fuel prices in 2024. The actions taken by Saudi Arabia, Russia, and OPEC in navigating these energy dynamics will influence their positions as elections draw near during the Biden administration. With surging energy prices, policies unfavorable to domestic oil and gas, and public discontent with the handling of climate change, the Biden administration faces a challenging election season.