Industry groups appeal court order threatening Gulf of Mexico oil production

The American Petroleum Institute, the largest oil trade group in the United States, has joined forces with several other top energy industry organizations to protest a court order they claim threatens oil and gas production in the Gulf of Mexico .

API, EnerGeo Alliance, the National Ocean Industries Association, and Chevron USA said the order puts “current and future U.S. energy supply” at risk in an appeal filed Wednesday evening.

The order in question was issued by the U.S. District Court for the District of Maryland in August. In the decision, the court ruled in favor of several environmental groups that filed a lawsuit after the National Marine Fisheries Service released its 2020 biological opinion on offshore oil and natural gas production in the Gulf of Mexico.

The groups said the opinion, which is required to ensure drilling and other developments do not threaten endangered species, underestimated the environmental effects of oil spills on local wildlife, such as sea turtles and the Rice’s whale.

The district court found the opinion unlawful and vacated as of December 2024, ordering a new opinion to be produced by the same month. However, NMFS has warned it likely will take until early 2025 to complete.

In their appeal, the energy industry groups warned that the timeline for vacating the opinion could halt all oil and natural gas production in the Gulf of Mexico.

“American oil and natural gas production in the Gulf of Mexico is a driving force of energy security here in the U.S. and around the world, supports hundreds of thousands of jobs and generates billions for state and local revenue,” the groups said in a statement. “If this ruling is left uncontested, a critical source of current and future U.S. energy supply could be in jeopardy at a time of persistent inflation and geopolitical instability.”

The groups said that by not providing NMFS with more time to issue a new opinion, the order could result in delays or halted permits for daily operations, putting production and worker safety at risk.

The Gulf of Mexico generates around 15% of all domestic oil production and 2% of natural gas production, adding more than $34.3 billion to the country’s GDP and $6.1 billion in federal government revenue, API detailed.

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The appeal comes just days after API sent a letter to Commerce Secretary Gina Raimondo , warning of the economic risks a delayed opinion could bring.

“It is in the best interest of U.S. consumers, the federal government, and oil and gas producers to partner to resolve this issue,” the group said.