Mike Sommers, chief executive officer of the American Petroleum Institute, got the whirlwind tour of Louisiana in recent days, meeting with membership companies and politicians who are vying to sway the Biden administration towards softening what they consider abrupt policies against fossil fuels.

Sommers was able to sample plenty of local crawfish, tour a massive liquefied natural gas export terminal and see a wetland supported using oil and gas money, while voicing his top concern that a temporary ban on federal leases onshore and offshore won't be lifted, ever. 

"There's a saying in Washington that there's nothing more permanent than a temporary program," Sommers said. 

While it doesn't impact the ability for companies to operate on private land, the environmental stewardship push now may stunt the industry for decades to come, he said. API's members include Exxon Mobil, Shell, Chevron and BP, among others on the extraction and refinery side of the petrochemical pipeline. 

The long-term impact for the oil and gas sector in the Gulf of Mexico is unclear. All oil and gas exploration offshore are federal waters, requiring leases auctioned off and royalties collected in exchange for extraction of public natural resources. 

After multinational giants work through existing projects, which could take years, the drilling ban eventually could catch up if the work and the money dries up. 

"Fossil fuels are not the enemy; greenhouse gas emissions are the enemy," Sommers said. 

The fossil fuel lobbyist pushed back on claims the coronavirus pandemic marked the "peak" for oil demand, when workers  stayed home and took Zoom meetings for months instead of traveling. 

The International Energy Agency estimated global demand before the pandemic was 100 million barrels of oil each day in 2019. 

"In the worst part of the pandemic, in April of last year, the world was still consuming 81 (million) barrels of oil every single day. We basically shut down the world economy and we were still using 80% of what we were using pre-pandemic," he said. "And we're getting close to the point now where we're getting back to that 100 (million) barrels."

Before the coronavirus pandemic prompted an economic shutdown, peak world oil demand was projected to happen in the late 2030s by major research organization and rating agency S&P Global. 

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Roughly a year later, S&P Global Platts Analytics predicts that weaker demand for oil during the pandemic was not significant enough to really change that forecast. Without sweeping changes to how the economy runs on oil, the outlook isn't expected to change much, though long-term demand volume has been "permanently altered" by changing behaviors. By the end of this year, roughly 75% of global oil demand is expected to bounce back. 

Likewise, S&P Global predicted that average annual oil demand growth would need to fall by more than 50% for peak oil to happen by 2025. 

Sommers bristled at the concept that oil and gas industry businesses are heavily subsidized. "This is an industry that subsidizes," he said. "The return to the American taxpayer every year from oil and gas revenues and tax dollars is so significantly beyond anything considered a fossil fuel subsidy in the federal tax code."

At stake, industry lobbyists assert, are lots of jobs if the federal ban does become permanent. 

Lobbyists claim that by 2022, Louisiana could risk 48,000 jobs related to the federal ban, which appears to include associated workers. 

As of March, there were 28,600 workers in the mining and logging sector, which includes oil and gas services businesses, down from 34,800 a year ago.  

One caveat is that some construction and manufacturing jobs are tightly tied to the oil and gas sector and may not be explicitly included in the employment data available. 

Even so, oil and gas money has long subsidized environmental and community projects in Louisiana, even before offshore revenues came pouring in. 

Sommers visited the Rockefeller State Wildlife Refuge and Game Preserve in Cameron Parish, just south of Lake Charles. The Rockefeller Foundation leverages revenue from royalties, rentals and leases from exploration and development of oil and gas alongside any other minerals on land in Vermilion and Cameron Parishes to support the state park. 

"One of the things they made clear to me was that if it was not for the partnership of the oil and gas industry, they would not have the dollars they need to continue to preserve the water fowl and this incredible ecological system," he said.

Editors note: This story has been updated to accurately reflect global oil demand numbers. 


Email Kristen Mosbrucker at kmosbrucker@theadvocate.com.