EPA: Methane Rule Rollback Cuts Crude Prices by 11 Cents

The Environmental Protection Agency projects a 0.14% drop in U.S. crude prices by 2027 following a proposed rollback of methane emissions rules.

President Donald Trump and EPA Administrator Lee Zeldin announced the plan in Lubbock, Texas, on Tuesday to reduce regulatory costs. Zeldin stated, “When owners and operators can produce, America benefits with lower prices.” The agency estimates the change will lower crude prices by 11 cents per barrel in 2027.

Domestic oil production is expected to rise by 0.09% under the new guidelines. This increase equates to roughly one additional barrel for every 1,000 the United States would otherwise produce. The proposal remains subject to a public comment period and further review before finalization.

CLSA energy research analyst Baden Moore noted that uncertainty over the policy’s durability may constrain near-term investment decisions. He said this “limits the upside to current production rates in the near term,” including in 2027. Moore anticipates the policy will affect only a small portion of the U.S. shale market.

The agency plans to adjust methane requirements based on well site production levels or extraction methods. It will also eliminate the Super Emitter Program, which currently uses third-party monitors to identify major releases. Operators could manage associated gas through flaring that destroys 95% of methane.

The EPA estimates the proposal will save the U.S. economy approximately $45 billion between 2027 and 2050. This figure includes roughly $42 billion in lower compliance costs. The agency expects operators to capture less gas for sale, resulting in about $4.2 billion in lost revenue, a cost already factored into the savings estimate.

Marginal wells account for about 80% of active U.S. wells but less than 10% of total production, according to the International Energy Agency. With oil prices expected to remain above $80 per barrel, many of these wells are already commercially viable. The Trump administration has separately moved to ease sanctions on Russian diesel exports to address fuel prices.