U.S. policies aimed at restricting the domestic production and delivery of oil and natural gas within the Biden administration’s first year are putting upward pressure on energy prices that could have dire results, warned Mike Sommers, president of the American Petroleum Institute (API).

“When policy signals prevent energy leadership here at home, there are going to be consequences,” Sommers said during his State of the American Energy address on Jan. 12.

In his annual address, Sommers noted the slew of policy changes implemented by the Biden administration within the past year that has restricted domestic output and led the country to seek relief at times from OPEC and elsewhere—ultimately undermining America’s energy independence. However, Sommers did express hope for more agreement than usual in policy debates this year, adding that American energy leadership solves so many problems that the nation faces including the energy transition.

“America should not be in the position of asking for foreign energy supplies, especially when we have abundant resources produced to standards that are among the highest in the world, right here at home,” he noted. ”Instead, we should be leading, as the world’s top producer of natural gas and oil.”

Further, the Biden administration’s decisions this past year to stop new leasing on federal lands and canceling the Keystone pipeline did not sit well with Sommers.

“As a country, do we really want to stay on the path of restricting production, denying permits, closing off access and returning to the days of dependence on foreign sources? This is shortsighted energy policy and we must consider those it’s impacting,” he said.

Learn the lesson

Sommers also talked about the catastrophic energy crisis in Europe where electricity prices have skyrocketed due to higher natural gas prices and few sources of electricity.

“We don’t want to learn that lesson the hard way,” he said.

Using the conflict unfolding between Russia and Europe involving the Nord Stream 2 gas pipeline as an example, he noted that nations that depend on energy production from suppliers that have “agendas of their own” leads to disastrous consequences.

“Take the Nord Stream 2 pipeline,” he said. “It sounds like a good idea for European economies to depend on regional energy suppliers—that is, so long as you forget who is on the other end of that pipeline. The problem is that when certain foreign governments control your energy, they have the power to use it for their own purposes—not yours.”

Energy transition

While energy transition is a term that is frequently heard during energy discussions, Sommers noted that in reality it simply means that the fossil fuel industry is evolving and transitioning through a combination of new technology, cleaner fuels and new systems to deliver energy with fewer emissions and a smaller carbon footprint.

Sommers also highlighted that the U.S. has always been at the forefront of technological and environmental progress.

“Our industry brings the scale and expertise to make a lower-carbon future a reality,” he said. Time and again, he added, the nation has illustrated how major breakthroughs come not by “forced regulations and mandates, but through innovation and technology.”

As the global energy demand continues to grow, even if every signatory to the Paris Climate Agreement fulfilled their commitments, Sommers noted that government experts say natural gas and oil will still account for almost half of all energy used—which he said should be produced in the U.S.

“It’s got to come from somewhere, and it ought to be from the United States of America—where we have vast reserves, a highly skilled workforce, stringent environmental rules and strong industry standards,” he said.

Call to action

Lastly, Sommers issued a call to action to President Joe Biden, the Congress and to the lawmakers across all the 50 states to strengthen American energy leadership while building on the progress the U.S. has made in reducing emissions to historic lows.

He urged the administration to work with the oil and gas industry to implement policies that address the challenge of climate change through public-private partnerships, incorporating innovation and lending scale and expertise of the fossil fuel industry.

He also stressed the need to prioritize advancing American energy leadership with policies that encourage the development of domestic energy production.

Noting the significance of regulations in sustaining American leadership and shaping a lower-carbon future, the API chief also expressed the need to design regulatory policies to unleash private investment and build on the ongoing technological progress, particularly on methane emissions reductions.