In the US presidential debate, there was one key economic issue on which both candidates were at complete variance with each other. And that was fossil fuels. Democratic nominee Joe Biden vowed to transition from the oil industry to renewables. Incumbent President Donald Trump, on the other hand, remained friendly to the oil and gas sector, even terming these comments as big mistakes, given the reliance of several states’ economies on this industry.
Biden clarified later that he only meant federal subsidies would be withdrawn from oil companies and also that fracking, widely considered hazardous to the environment, would not be banned.
This fractious debate over the need to phase out fossil fuels is not just taking place in the biggest economy, it is happening all over the world.
It is partly due to the Covid crisis and partly because of the growing recognition of the environmental impact. But the immediate predicament for the hydrocarbons sector has undoubtedly been the pandemic. The global oil industry, which was looking forward to higher prices and increased demand at the beginning of 2020, now faces a continued softening of prices as well as a prolonged spell of low global consumption.
Oil-exporting countries are expected to face a contraction in growth by 6.6 per cent this year, according to estimates by the International Monetary Fund (IMF).