The U.S.'s reliance on fracking has enabled it to become the world's top oil producer, which could impact the transition to green energy.

In 2023, the U.S. produced more oil than any country has ever produced in a single year, according to the U.S. Energy Information Administration.

The advancements in horizontal drilling and hydraulic fracturing, commonly known as fracking, have led to an increase in productivity for Big Oil.

In 2008, U.S. oil production reached a low of 5 million barrels per day, but by August 2024, it had reached a record high of 13.4 million barrels per day.

The Inflation Reduction Act of 2022, which includes $369 billion to combat climate change, has led the Biden administration to expand subsidies for renewable energy projects.

The majority of that funding is delivered through tax incentives.

According to Daniel Bresette, president of the Environmental and Energy Study Institute, the U.S. energy policy has primarily focused on the tax code, which has led to the majority of renewable energy deployment to date.

Tax incentives, such as the intangible drilling costs tax credit, benefit the fossil fuel industry.

Amy Myers Jaffe, director of New York University's Energy, Climate Justice and Sustainability Lab, stated that the intangible drilling costs incentive is the most active subsidy they receive and it's a tax credit, according to CNBC.

The tax break for intangible drilling costs is projected to provide $1.7 billion in benefits to oil and gas companies in 2025 and $9.7 billion through 2034, as stated in the White House Budget for Fiscal Year 2025.

The complex U.S. energy subsidy landscape, the country's ability to produce more oil than ever, and the impact on the billions of dollars being spent on the green energy transition are all discussed in the video above.