OPINION: The US oil and gas industry is losing its loyal but flawed champion in the White House, Donald Trump.
Instead, it is gaining President-elect Joe Biden, who will prioritise a drive for renewable energy over aiding fossil fuels in a bid to tackle global warming.
Expect to see the victorious Democratic candidate take early action to rejoin the UN Paris climate treaty.
Biden is likely to use policy instruments under his control to introduce more stringent fuel-economy standards for cars, lower methane emissions at drilling sites and halt new oil and gas leasing on federal land.
Fracking will also be more regulated, and permits for big oil projects such as the XL Pipeline will be hard to obtain.
Once Biden gets his feet properly under the Oval Office desk in January, he will be pushing for a $2 trillion “green transition” and net-zero carbon emissions by 2050.
None of this will be welcomed by the US oil and gas sector, which is still reeling from low commodity prices caused by Covid-19.
But US energy policy needs to shift in order to meet the major challenge of global warming.
The US oil majors should follow their European counterparts and start plotting new long-term strategies rooted in the reality of a warming world.
The need for oil and gas will not disappear overnight, of course, but BP and others have suggested peak demand for crude may have already arrived.
After the US election results are certified and any disputes are addressed, there will be plenty of positives from a new "greener" presidency — despite the early downsides.
For one, it would bring the US in step with the rest of the world.
China has just promised to become carbon neutral by 2060. Japan has targeted 2050, as have South Korea and the European Union.
After calling global warming a “hoax” and downplaying the gravity of Covid-19, Trump never offered a credible platform to tackle either threat.
The world’s current superpower has so much more political, commercial and technological leadership to offer other nations if it ditches fake news.
Biden and Vice President-elect Kamala Harris will still have to tread carefully with plans for the energy transition, given the lack of a wider “blue wave” of victory in other electoral results.
The US Senate is likely to remain in Republican hands, and the Democrats will have a reduced majority in the House of Representatives.
The Senate in particular has been a brake in the past on comprehensive climate action.
But there are other reasons why Biden and Harris deserve support, and these contributed to the bounce back for oil prices and stock markets this week: a promise of more stability and rule by teamwork, not Twitter.
Biden is likely to bring cooperation rather than confrontation to the wider business and trade environment. We can expect him to try to improve relations with China, the European Union, and even with Iran.
But first and foremost, the president-elect has promised to get a grip on the country’s handling of the pandemic, which has cost almost a quarter of a million lives in the US.
The US oil and gas industry may be losing its tempestuous patron, but it is gaining a calmer guide to the future.
(This is an Upstream opinion article.)