What is the total US federal oil and gas subsidy estimate for 2023?
Executive summary
There is no single, uncontested federal “oil and gas subsidy” number for 2023; available reporting shows estimates that range from the tens of billions to well over three-quarters of a trillion dollars depending entirely on how “subsidy” is defined and which programs, tax expenditures, and implicit costs are counted [1] [2] [3]. Narrow, budget-line federal outlays and quantified tax breaks point toward modest tens-of-billions figures, while broader accounting that folds in preferential leasing, tax expenditures, R&D, loan guarantees and implicit environmental underpricing yields estimates in the high hundreds of billions — Forbes reports $757 billion for the U.S. in 2023 [2] [1] [3].
1. What different studies are actually measuring — and why that matters
Estimates diverge because analysts choose different baskets: some count explicit federal spending plus tax expenditures that reduce Treasury receipts; others add below-market federal lease and royalty terms and still others include “implicit” subsidies — the unpriced societal costs of pollution and climate damage; the EIA’s detailed federal accounting shows tax expenditures are a dominant share of quantified federal energy-specific support through FY2022, but its published dataset covers programmatic subsidies up through FY2022 rather than a single 2023 consolidated federal oil-and-gas figure [4] [2].
2. The narrow, budgetary view: tens of billions, not hundreds
Organizations that count direct, line-item federal outlays and historically quantified tax breaks often arrive at modest totals: long-standing conservative tallies have put U.S. direct fossil fuel subsidies at roughly $20 billion per year, a figure that reflects explicit budgetary support rather than implicit externalities [1]. The EIA’s FY2016–22 report shows natural gas and petroleum-related tax expenditures and support measured in specific fiscal‑year terms (including a reported $2.1 billion of natural gas and petroleum tax expenditure in FY2022), underscoring that narrowly defined federal fiscal support can be much smaller than headline “subsidy” claims [2] [4].
3. The expansive view: hundreds of billions when tax breaks, leases and incentives are aggregated
When analysts widen the lens to include preferential lease and royalty rates on federal lands, specialty tax preferences, R&D, loan guarantees and the full suite of incentives, U.S.-focused totals jump sharply; Forbes reported that the U.S. fossil fuel industry collected $757 billion in incentives in 2023, a figure that aggregates many federal programs and favorable terms in a single headline number [3]. This approach aligns with advocacy and investigative studies that emphasize how tax code provisions and below‑market public assets effectively transfer value to producers beyond narrow annual appropriations [3] [1].
4. Global context and implicit subsidies — why $757B and $7T mean different things
Global assessments that include implicit underpricing of environmental and health damages produce vastly larger numbers: the IMF estimated $7 trillion in fossil‑fuel support globally in 2022 by adding explicit subsidies and the value of unpriced externalities, and other international bodies (IEA, Our World in Data) show global subsidy flows changing sharply through 2022–23; these global totals are useful for comparison but cannot be mapped one‑for‑one onto a single U.S. federal fiscal line item [5] [6] [7]. The IEA reported governments spent $620 billion on fossil‑fuel use subsidies in 2023 globally, illustrating variation by methodology and jurisdiction [7].
5. Bottom line and responsible reading of the evidence
If the question is “What did the U.S. federal government explicitly spend or forgo in 2023 on oil and gas in narrowly defined budgetary terms?” the best-available, authoritative public accounting points to figures in the low tens of billions for direct, explicit subsidies and documented tax expenditures as of the EIA’s FY2022 reporting, with some program specifics quantified [2] [4] [1]. If the question intends the broader policy-economic transfer to oil and gas in 2023 — counting preferential leases, tax preferences, subsidies embedded in law and many categories of incentives — published reporting and media summaries provide much larger estimates, with Forbes citing $757 billion for 2023 as a consolidated figure and global comparisons from the IMF and IEA showing still larger sums when implicit costs are included [3] [5] [7]. The discrepancy is methodological: readers must decide whether they mean narrowly budgetary subsidies or an expanded accounting that bundles tax breaks, preferential access to public assets and unpriced externalities [4] [2] [3].