This chapter analyses how the American Petroleum Institute (API) adapted to the post-Deepwater Horizon (DWH) oil spill era despite the criticisms from investigation reports that brought into question its role as private standard-setter in the oil and gas industry and the reliance of federal regulations on the API’s standards. Grounded on the theory of regulation, investigation reports, and documents from the Bureau for Safety and Environmental Enforcement (BSEE) and the Center for Offshore Safety (COS), this chapter examines the organizational response of the API and how BSEE, as the federal regulator, endorsed it. It proposes a definition of what a regulatory crisis is, and argues that despite the regulatory crisis created by the DWH accident, the API increased its influence in offshore oil and gas regulations in the US not only as rule-maker but also as supervisor. The chapter identifies the gaps in transparency and regulatory practices that may undermine the effectiveness of the new regulatory scheme. By presenting a case from the oil and gas industry, this research aims to contribute to the broader scholarship on the responses of transnational private regulators in times of crisis.

The expansion of offshore drilling to deeper waters in the Gulf of Mexico and to more remote waters in the Arctic, as well as more intense hurricanes induced by climate change, have heightened risks of major well blowouts and oil spills. The Trump administration worsened these risks by rolling back regulations that had been enacted in response to the 2010 BP oil spill, the largest unintentional spill in the world (as of 2020), and to near misses during the 2013 Shell Arctic expedition. These rollbacks, plus poor government oversight of companies and scant attention to companies’ safety culture, risk a repeat of past oil spill disasters that devastated coastal communities. Members of the bipartisan commission that had investigated the spill reiterated its warnings in 2020 that another major oil spill is simply a matter of time and called for stronger laws governing offshore drilling. A number of congressional members did propose legislation to improve safety in offshore drilling. Unfortunately, despite the shifting tide against offshore drilling in coastal states, the majority of Republicans and those Democrats from states reliant on oil extraction failed to support these initiatives, putting at risk Americans’ lives, livelihoods, coasts and oceans.