It's official. Donald Trump will return to the White House next January. A victory much feared by all climate defenders. Others are already rubbing their hands: the oil companies. During a campaign, the Republican promised multiple actions in favor of the sector, after the Biden administration took several environmental measures limiting the drilling of oil wells.
US presidential election: Donald Trump's next steps
According to several American press titles, the businessman even asked the oil and gas industry for financial support to the tune of a billion dollars during a dinner organized in Florida last April. In exchange for these funds? The promise of much greater savings, via advantageous taxation and deregulation of the sector. The stated objective is to boost production. He thus adopted the famous campaign slogan of the Republican Party during the 2008 presidential election: « Drill, baby, drill ! » (which could be translated into French as “Fore, darling, fore!”).
Broad support from the oil industry
The organization Climate Power estimates, for its part, that official donations from oil and gas lobbies paid as part of Donald Trump's campaign, as well as to the Republican National Committee and affiliated committees, reached more than 75 million dollars (or around 70 million euros). Between them, the powerful billionaires Harold Hamm (Continental Resources), Kelcy Warren (Energy Transfer Partners) and Jeffery Hildebrand (Hilcorp Energy Co.) are said to have paid, with their wives and their companies, more than 15 million dollars (or approximately 14 million euros), thus reports the New York Times, which takes up this study.
The remaining roughly $60 million comes from lesser-known miners, engineering firms, hedge funds and extraction companies. These are only declared donations. Donations made to non-profit organizations are generally not disclosed.
While Donald Trump is far from reaching his billion-dollar goal, oil and gas remains one of the main industries that financed his campaign, according to the monitoring group OpenSecrets. The amounts allocated by this industry are only exceeded by conservative lobbies, themselves largely financed by oil and gas interests.
Expected lifting of drilling restrictions
If he keeps his promises, the new president should very quickly decide to torpedo the restrictions on drilling in the Arctic part of Alaska, put in place by his predecessor. It is also expected to issue tenders for more oil concessions in the Gulf of Mexico. Another measure eagerly awaited by the industry: the lifting of the temporary freeze on permits for new terminals dedicated to the export of liquefied natural gas (LNG), introduced last January by Joe Biden.
With strong support from the next American administration, the impact of this industry should therefore be significantly strengthened to the detriment of all environmental issues. Already, under the Biden era, and despite its climate policies which the fossil fuel lobby has regularly complained about, the country had never produced so much crude. Daily production now stands at around 14 million barrels of oil per day.
Already record oil production
The shale gas and oil revolution has propelled the United States into an extremely favorable position. While in 2010, they only accounted for 9% of the market share in global oil production, they now hold almost 20% of the market. Enough to catapult them to the rank of leading oil producer. Same phenomenon on gas. In the space of 15 years, the United States went from a position where it did not export gas to that of the leading exporter of liquefied natural gas (LNG) in the world, ahead of Qatar.
“The United States will dictate the pace of the transition,” predicts TotalEnergies
Still, pushing the level of oil production even higher will not be an easy task. Indeed, the industry will have to make large investments: the lifespan of an unconventional oil well is only around three years. In addition, its deposits are of average quality. “The United States has room for improvement, but everything will depend on the price”points out Ahmed Ben Salem, analyst at Oddo. If the price of oil on the markets is low, and lower than the marginal cost of American production, it will no longer be relevant to invest in production. “ However, it is not excluded that Saudi Arabia decides to enter into a price war “, warns Ahmed Ben Salem.
After having skyrocketed at the opening of the European stock exchanges, the share prices of the oil majors plummeted in the middle of the day, losing up to 2.2% for the British BP and almost 3% for TotalEnergies compared to the point high reached shortly after 9 a.m. Which may seem counterintuitive since Donald Trump largely supports this industry.
“At the beginning, the market was very reassured. There was a sort of “phew”. But then, we can assume that the market anticipated an increase in customs barriers, which could lead to a slowdown in global economic growth and therefore in oil demand.explains Ahmed Ben Salem, analyst at Oddo.
