America’s Energy Advantage Depends on Stability, Not Policy Whiplash

The Gulf Coast’s energy economy is strong, growing, and indispensable to the nation’s future. But according to LSU’s newly released 2026 Gulf Coast Energy Outlook, one factor threatens to undermine that success more than any market force: federal policy instability.

The annual report from LSU’s Center for Energy Studies paints a clear picture. Oil and gas production along the Gulf Coast continues to rise. Manufacturing investment remains robust. Electricity demand is climbing as industry expands. Yet layered over all of it is what the authors describe as “policy uncertainty” — rapid swings in federal energy policy that complicate long-term planning and discourage investment.

That uncertainty is not theoretical. The report points to dramatic federal shifts on offshore leasing, LNG export permits, offshore wind policy, tax credits, and tariffs. These abrupt changes create what amounts to policy whiplash, forcing energy producers and manufacturers to delay or rethink billion-dollar capital decisions that require decades of certainty.

Oil and Gas: Growing Despite Washington, Not Because of It

One of the most striking findings in the report is that oil and gas production continues to grow even as rig counts decline. That growth is being driven by efficiency gains and technological improvements, not increased drilling activity.

In August, Gulf Coast crude production reached 10.2 million barrels per day, while natural gas production hit 63.6 billion cubic feet per day — both historic highs. LSU projects continued growth through at least 2030 for crude oil and 2032 for natural gas.

Importantly, this growth is happening even though prices have remained relatively flat when adjusted for inflation. That reality underscores a key point often ignored by critics of the industry: America’s energy sector is becoming more productive, more efficient, and more resilient, even in the face of regulatory pressure.

This is not an argument for government micromanagement. It is evidence that when allowed to innovate, private industry delivers results.

Electricity Demand Is Rising — and Policy Must Keep Up

The report also finds that electricity markets are at an inflection point. After roughly two decades of flat demand, electricity use is rising again, driven by large industrial projects and the rapid growth of data centers.

Maintaining the Gulf Coast’s historically low electricity prices — a major competitive advantage for Louisiana — will require thoughtful planning around infrastructure and resource adequacy. That means reliable baseload power, investment in transmission, and realistic assessments of grid needs.

Energy policy driven by ideology rather than engineering risks undermining affordability and reliability just as demand is accelerating.

Louisiana’s Outsized Role in Energy Investment

Since 2012, the Gulf Coast has attracted approximately $263 billion in energy-related manufacturing investment. Louisiana alone accounts for 54 percent of that total — a testament to the state’s infrastructure, workforce, and longstanding energy expertise.

The report notes that so-called “energy transition” projects, including carbon capture and hydrogen, now represent 41 percent of new manufacturing announcements. Whatever one’s view of those technologies, the lesson is clear: Louisiana is positioning itself as a place where energy innovation of all kinds can happen — provided the rules are stable and predictable.

Employment in Louisiana’s oil, gas, refining, and chemical sectors is expected to remain relatively steady through 2028, reinforcing the industry’s role as a foundation of the state’s economy rather than a relic of the past.

The Real Threat: Uncertainty from the Top Down

The LSU report does not argue against innovation or diversification. Instead, it highlights a more fundamental truth: capital-intensive industries require certainty. When federal policy swings wildly from one administration to the next, the result is delayed projects, higher costs, and lost opportunities.

Louisiana’s energy economy thrives when policymakers respect market realities, support domestic production, and provide clear, consistent rules. It struggles when Washington substitutes political signaling for sound economic policy.

The Gulf Coast has proven it can deliver affordable energy, good jobs, and national security benefits. The question heading into 2026 is whether federal leaders will allow that success to continue — or get in the way.