Work

Assessing the Future of Oil and Gas Production and Local Government Revenue in Five Western US Basins

Year: 2024

Type: article

Abstract: Oil and gas production is a major source of public revenue in many US regions, but uncertainty exists over the future of demand for hydrocarbons. We model how oil and gas production and related government revenue change in five western US basins depending on future oil and natural gas prices under three scenarios of climate policy ambition. We find that the Green River and San Juan basins experience production declines across all scenarios, while production in the Bakken, Permian, and Powder River basins are more dependent on prices. Government revenue generally follows the direction of production, but these relationships are not directly proportional. Under the lower price scenarios, revenue declines more steeply than production because it reflects both production and prices, which both decline. Long-term permanent funds, which are in place across all the states we examine, provide an important fiscal cushion for school districts, their primary beneficiary. JEL Classification : H71, H72, H73, O13, Q41, Q48

Source: The Energy Journal

DOI: 10.1177/01956574241290609

Authors: Brian Prest, Daniel Raimi, Zachary D. Whitlock

Institutions: Resources For The Future, University of Michigan

Language: English

Topic: Natural Resources and Economic Development

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Climate action

Open Access status: bronze

Funder: Resources for the Future