After a three-year interval with higher oil and gas royalty rates on federal lands, the Trump administration and Republicans in Congress have turned back the clock to the same levels as 1920.
The megalaw signed by President Donald Trump on July 4 slashes royalty rate hikes enacted under the Biden administration for both onshore and offshore leases.
The shift is another example of the Trump administration’s efforts to reverse former President Joe Biden’s policies and boost fossil fuels. While industry groups are celebrating the lower collection rates, critics say they will cut billions of dollars in revenue from federal coffers at a time when the U.S. is a net exporter of fossil fuels and the largest oil producer in history.
“It’s difficult to understand why we would be reducing royalty payments and providing this kind of significant subsidy to the oil and gas industry right now,” said Chris Winter, executive director of the Getches-Wilkinson Center for Natural Resources, Energy and the Environment at the University of Colorado, Boulder.
