The U.S. oil industry’s main lobbying group, the American Petroleum Institute (API), is weighing whether to price carbon emissions, a major shift after long resisting mandatory government climate policies, a source familiar with the decision making said.
The American Petroleum Institute, which includes most of the world’s largest oil companies, is considering supporting carbon pricing “among other policy solutions to reduce emissions and achieve the ambitions of the Paris Agreement,” the source said, confirming a report on the policy shift by the Wall Street Journal.
The IPY, has been forced to confront its resistance to regulatory action on climate change.
Some of its European members left the lobby group because of disagreements over its climate policies and support for easing drilling regulations, and the Biden administration is pursuing a policy agenda that would move the U.S. away from fossil fuels.
A draft statement on the policy shift reviewed by the Wall Street Journal said the group does not endorse a specific carbon pricing tool, such as a carbon tax or an emissions trading system.
However, the source noted that the group’s report on, The State of Energy. in the U.S., released in January, supported a market-based carbon pricing policy.
The API did not comment on whether or when the group would formally endorse a carbon price, but said it has been working on an industry-wide response to climate change for nearly a year.
“Our efforts are focused on supporting a new U.S. contribution to the global Paris agreement,” said API spokeswoman Megan Bloomgren.
Within API, there has been a growing rift between major European energy companies, which in the past year accelerated their plans to cut emissions and build large renewables businesses, and U.S. rivals Exxon Mobil Corp and Chevron Corp, which have largely resisted growing pressure from investors to diversify.
Other major industry groups, such as the Business Roundtable, of which Chevron is a member, have in the past year supported market-based carbon pricing.