This week concludes a series I started last week on the trends to watch in 2023. 

As a reminder, at the start of every year, I take a step back from the daily news feeds about energy to dwell instead on the many longer-stride trends that are impacting oil and gas.

There are many ways to frame such analysis, and the framework I’m using goes by the name STEEPLE. The letters form a mnemonic, which refers to Social, Technology, Economy, Environment, Politics, Legal, and Ethical. The mnemonic started life as PEST, then evolved into STEEP, PESTLE and STEEPLE by progressively adding additional categories.

This episode will focus on the back half of STEEPLE: Environment, Politics, Legal, and Ethical. 

The environmental trends are those that concern themselves with our natural world.

At times, the energy industry seems to be driven by a singular environmental factor—rising levels of atmospheric carbon concentration. However, there are many other worrisome trends to keep front of mind.

Political trends are almost by definition country specific, but there are a few biggish ones that factor into energy calculations.

The first trend is aggressive energy geopolitics. Russia has demonstrated how an autocratic political regime over time can be tempted to use a carefully constructed energy market monopoly to bend market dependents to its will. Energy importers will be careful not to lock into such dependencies in the future, and the trend will clearly be to diversify energy supply or move to self sufficiency in energy.

The legal environment for energy is not static, but it doesn’t change quickly either. Nevertheless, I keep an eye on a few important trends.

Activists have been successful in weaponizing legal systems in western economies to tackle the energy industry. Approval cycles for energy developments (and even housing for veterans) in the western world continue to slow down and are now structurally out of step with both the rising demand for energy and the speed society demands to deal with climate effects.

It has long been recognized that there is an ethical dilemma at the very heart of the industry—the production and consumption of petroleum delivers great benefits for society but at a serious environmental and social cost. Halting the industry will quickly starve us and continuing the industry will slowly cook us.