It was as much a core tenant of his political philosophy as mass deportations. I was really looking forward to seeing how he was going to coerce big oil into producing more and selling for less. Tax breaks and no environmental regs could only go so far. Seriously though, I know it was just another one of his “day one” lies. I wonder also how his health care plan is coming along. I wish somebody would ask him.
Why? He would just lie.
And the press goes “oh well, that’s Trump.”
And no-one cares.
Whatever happened to “drill, baby, drill”?
Somebody jiggled their car keys and Trump forgot all about it.
Remember when Republicans were so passionate that Canada get to build an oil pipleline across the US?
He’s doing things on this front. For example:
I’m not sure why you haven’t encountered that news, it seems to have been covered at a reasonable level.
AIUI, big oil has had for years permits for numerous sites which have remained undrilled. I’m not sure they’re interested in an oil glut.
I guess the stupidity happening behind the scenes is being upstaged by the publicized stupidity.
About half of what this administration does is designed to distract from and camouflage the other, probably more destructive, half.
Indeed. There’s lots of news about how Musk might shrink Medicare, or how he might shrink Social Security.
Trump did cut military spending by 8%. My expectation will be that he’ll continue to salami slice it down and down, pull out of Europe, all the while saber rattling about how much we need Greenland, to stop Chinese expansion - all the while giving up ground and capability.
Likewise, the US will tariff itself of every foreign product - hitting ourselves equally on all fronts. Meanwhile, Europe and China will only take an economic hit from the single direction of their trade with the US. The brunt of the impact is on the US and the manufacturing capacity that US business was exploiting in China will be freed up and offered at a discount to European business. Aldi will take over from Walmart.
I think you’re misreading that.
Hegseth said beginning immediately, the Pentagon will pull 8% — or roughly $50 billion — from nonlethal programs in the current budget and refocus that money on President Donald J. Trump’s “America First” priorities for national defense.
An internal reallocation is not a cut. Moreover, the Continuing Resolution budget increased DoD funding by $8 billion.
Back on oil. Trump’s first day Executive Order was sweeping.
Since then (Alaska has already been mentioned):
Trump to impose 25% tariff on countries that buy oil, gas from Venezuela
Oil Firms Seize Chance to Fight State Climate Laws—With Trump’s Help
Trump administration sends a clear message to the oil and gas industry: ‘You’re the customer’
It’s been mostly the business press covering this, but it’s hard to think of any more gifts they’d want under their Christmas trees.
A lot of people lost a lot of money drill baby drilling during the shale boom. Equipment supply chains are still shot and vulnerable to tariffs. Labor is expensive and in short supply. So O&G investors want dividends, not overleveraged expansion.
Exxon and Chevron are getting hit hard by declining oil prices, and tariffs are expected to hurt their refining business. Here’s an article from Jan 31:
Refineries in the U.S. Midwest depend on Canadian oil for as much as three-fourths of their crude inputs. Meanwhile, Mexican supplies have long been a staple of Gulf Coast fuel-making plants designed to maximize output from so-called heavy crude. As the cost of buying oil from those two nations rises, it could create a knock-on effect for other types of crude as refiners clamor to secure replacement barrels with similar characteristics.
So I can understand why Trump isn’t tweeting about oil now.
This right here. I am in the upsteam O&G business. Free cash flow (and the dividends which result) are the major economic drivers throughout the US O&G sector. This is a huge change from the 2010s when growth and expansion (drill baby drill) at all costs was the driver of everything. There are, of course, differences in policy in the new administration, but federal rules and regulations mostly affect the industry at the margins. We are far more driven by what happens at state levels outside of any major EPA rulings.
The upshot of this is we are reaping dividends from past ridiculous levels of investment, but as an industry, we are unlikely to make major expansionist moves to increase drilling unless it is due to pricing. Keep in mind, most US operators are heavily hedged with regards to prices, so spot changes in oil or natural gas prices don’t move the needle much in terms of signaling for increasing the number of rigs. If we see a significant change in price, we just try to lay in more hedges to capture that gain for a longer period of time rather than increase our rig count. Increased rig count requires additional capital outlays over our planned budget. This is frowned upon at the investor level.
At the moment, if you read up on the subject more, they’ve started figuring out positions to cut, they’ve mandated a reduction, and they’ve declared a list of protected initiatives that pointedly exclude anything that would deal with EU assets or projects that would have EU customers.
I haven’t seen anything about increasing spending to any particular thing. If all the budget adjustments to date are negative, and there’s no matching increases, then it’s not a relocation.
Congress is talking about a budget increase - but below inflation, so effectively a reduction - and Trump is talking to China about shrinking military budgets by half, with China saying that they’ll follow if we lead.
Maybe they’ll start increasing at some point. Maybe that number will match the reductions. At the moment, that hasn’t occurred and no one is paying much attention to the question.
That sounds about typical for Trump’s level of deal-making skill.
As for “Drill Baby Drill”, there just isn’t all that much American oil, compared to American usage of it. It’s not physically possible to do much there.
What do you mean by this? US oil production (when including NGLs) is not that much less than total US consumption. Off the top of my head, US oil production is around 80-90% of consumption. The US does still import a large volume, but we also export a large volume (though obviously less then we import since we do still run a deficit). This doesn’t seem to be the most efficient, but my more limited understanding of the downstream industry is this makes sense because of how refineries are set up.
In short, the US could produce a good bit more if there was really a desire and someone could generate the appropriate domestic demand signals through long-term pricing. The reserves and production capabilities are either there or could be there within a few years.
Planned future reductions in personnel is not already having cut anything. Nor do the articles say anything about the budget itself being cut. They could simply move the funds over to more favored projects. Probably illegal, but they would do it anyway.
However, this is a hijack so I won’t be pursuing it.
Net exporting crude + products for a few years now, see chatter about energy independence from the refinery-challenged.
*tenet
Though “tenant” in the sense of something occupying what’s left of his mind is an appealing thought.
They are drilling quite a bit. They would need to bring back tar sands to get the publicity Trump wants.
The US is currently:
Producing more oil than any nation on earth
Producing more oil than at any time in its history
A NET exporter of about 1.6 million barrrels/day
And as was said upthread, investors have made it clear $70-80 is their sweet spot for oil prices.
This was actually one of the things Biden should have made clear: The US is producing plenty of oil, and the records came on his watch. I know that would have angered the Greens, but it’s pretty clear how little use the Greens were in getting Harris elected.