Energy sector-related exchange traded funds suffered a blow from the presidential debates after Democratic challenger Joe Biden said he aimed to transition away from crude oil.
The Energy Select Sector SPDR (NYSEArca: XLE), the largest equity-based energy exchange traded fund, declined 1.5% on Friday.
Biden, who has been leading in the polls, stated he planed to transition to a more climate-friendly economy, Reuters reports.
“Global warming is an existential threat to humanity,” Biden said. “We have a moral obligation to deal with it and we’re told by all the leading scientists in the world we don’t have much time.”
Biden argued that the country should eventually replace oil with solar, wind and other forms of non-polluting power.
“I would transition from the oil industry, yes,” Biden said.
On the other hand, Trump said that while he loves the environment, he was not willing to harm the energy sector in order to support the environmental cause.
Big Oil’s Response
The oil industry has censured Biden’s plans to transition away from fossil fuels.
“Six-dollar gas is coming if Trump isn’t re-elected,” Continental Resources founder Harold Hamm told FOX after the former vice president outlined his approach to energy policy at Thursday night’s debate.
“If Biden is elected and his plan on energy is adopted, he will send America into a deep depression and millions of jobs will be lost in Texas, Pennsylvania, Ohio, Michigan, Oklahoma, North Dakota and we will once again be beholden to foreign rogue regimes for our energy,” Hamm added.
Biden, though, later clarified that he was referring to plans to stop fossil fuel subsidies.
“We’re not getting rid of fossil fuels,” Biden said. “We’re getting of the subsidies for fossil fuels. But we’re not getting rid of fossil fuels for a long time … they’re not going to lose their jobs. Besides, a lot more jobs are going to be created in other alternatives.”
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