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Reproduced from Rapidan Energy Group; Chart: Axios Visuals

U.S. oil production is in a steep decline, but one question is how much November's elections will affect how much it does — or doesn't — bounce back.

Why it matters: The powerful price and demand headwinds from the coronavirus pandemic are creating a financial crisis in the oil patch.

  • The fallout will be continuing come November, which will bring a choice between candidates with hugely different energy and climate policy plans.
  • Joe Biden is vowing new steps to stem heat-trapping emissions and accelerate the transition to cleaner fuels and power sources, while President Trump opposes climate regulations and curbs on fossil fuel development.

The big picture: Under the base case of an analysis by Rapidan Energy Group, the "near-term macroeconomic risk remains skewed firmly toward longer, deeper economic weakness," but recovery awaits.

  • U.S. production is a million barrels per day lower by 2023 under Biden than Trump.

Yes, but: Under a weaker price and demand recovery forecast, the effect of Trump's policies compared to Biden's is much smaller.

  • "U.S. shale’s outlook under a weak macro environment differs negligibly under a Trump or Biden presidency," they note, citing the financial strain on the sector and problems accessing capital.
  • "Trump policies would do little to resurrect the sector while Biden policies would do little additional harm."

One level deeper: Rapidan analyzed market scenarios through 2023, and then grafted the policy overlay onto that outlook.

  • The base-case scenario sees Brent crude prices rebounding to the low-$50s in 2023 and a 10 million barrel per day recovery in demand.
  • But the weaker-recovery scenario sees prices only in the low-$40s in 2023 and a demand revival that's about 25% smaller than in the base case.

The intrigue: Under the base case, various Biden policies that act as a check on the amount of shale production levels include requiring stronger emissions controls, thwarting fossil fuel infrastructure, and allowing more Iranian barrels onto the market.

Go deeper

Ben Geman, author of Generate
Sep 1, 2020 - Energy & Environment

Climate change groups demand Biden ban fossil fuel reps in his admin

Biden speaks during a campaign event at Mill 19 in Pittsburgh. Photo: Carolyn Kaster-Pool/Getty Images

The green movement's left flank is stepping up efforts to shape Joe Biden's circle of advisers, releasing an open letter Tuesday calling for a ban on all "fossil fuel executives, lobbyists, and representatives from any advisory or official position on [Biden's] campaign, transition team, cabinet, and administration."

The big picture: It's signed by 145 local and national groups. These are actors that will battle more moderate Democrats for influence if Biden wins and Democrats control Congress, such as Sunrise, Oil Change U.S., Justice Democrats, 350.org, Greenpeace and others.

Updated Aug 31, 2020 - Politics & Policy

Biden: Trump is "rooting for chaos"

Joe Biden on Monday gave his most forceful counterargument to President Trump on the issue of law and order, arguing in Pittsburgh there would be more violence in America if the president is re-elected.

What he's saying: "You know me. You know my heart. You know my story. Ask yourself: Do I look like a radical socialist with a soft spot for rioters? Really? I want a safe America," Biden said.

Twitter labels Trump campaign tweet for misleading clip of Biden speech

Photo: Kyle Mazza/Anadolu Agency via Getty Images

Twitter on Monday labeled a tweet from the Trump campaign's "War Room" account "manipulated media" for posting a misleading clip of Joe Biden saying, "You won't be safe in Joe Biden's America!"

Reality check: More context would have shown that Biden was quoting President Trump and Vice President Pence as saying, "You won't be safe in Joe Biden's America," during a speech in which the Democratic nominee was condemning violent protests and Trump's response to social unrest.