“”I have never felt more uncertainty about our business in my entire 40-plus-year career,” said one survey respondent. Another respondent called “uncertainty” the “key word to describe 2025,” adding, “There cannot be ‘U.S. energy dominance’ and $50 per barrel oil,” a stated goal of the Trump administration. (The current cost of oil is about $70 per barrel.) At that price, “We will see U.S. oil production start to decline immediately and likely significantly (1 million barrels per day plus within a couple quarters). This is not ‘energy dominance.'”
“The administration’s chaos is a disaster for the commodity markets. ‘Drill, baby, drill’ is nothing short of a myth and populist rallying cry,” one comment succinctly said.
It’s not just Trump’s rhetoric that has the energy industry on edge; it’s his trade policies, too. One respondent noted that tariffs “immediately increased the cost of our casing and tubing by 25 percent.” Another said, “Washington’s tariff policy is injecting uncertainty into the supply chain.””
“the U.S. is heavily reliant on Canadian crude oil to make liquid fuels and other petroleum products. Most U.S. refineries were built in the 1970s to accommodate heavy oil from the Middle East and Canada. This was well before the American shale boom, which brought lighter-grade oil to the market. In 2023, nearly 60 percent of crude imports came from Canada and July 2024 saw a record 4.3 million barrels of oil per day imported from the country.
“Canada is by far our largest supplier, and we build refineries specifically to refine heavier Canadian crude,” explains Nick Loris, the executive vice president of policy at C3 Solutions, a free market energy think tank. “Depending on the tariff rate and how long they’re in place, gas prices could rise anywhere from 10-30 cents per gallon, with the Midwest and the Rocky Mountain Region getting hit the hardest,” Loris tells Reason.”
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“tariffs could also harm American nuclear power. Despite generating the most nuclear energy in the world, the U.S. relies on other nations for uranium to fuel its fleet. Canada is the largest supplier of raw uranium (27 percent of imports in 2022), followed by Kazakhstan (25 percent) and Russia (12 percent), the latter of which the U.S. depends on for roughly a quarter of its uranium enrichment needs.
With last year’s passage of a bill to ban imports of Russian uranium signed into law, Canada is primed to play an increasingly important role in America’s uranium supply. Tariffs would threaten this and could increase fuel costs for American nuclear power producers”
Despite producing tons of oil, the U.S. still imports a lot of oil. The stuff we produce can’t be refined by our refineries, so we ship it out to be refined and import foreign oil to refine here.
“The big reason is that fossil fuel consumption is up. Oil and gas account for the bulk of this increase in emissions, with coal a distant third. While greenhouse gasses in the atmosphere are rising, their output is level or falling from some of the largest historical emitters. The European Union’s emissions are declining. US emissions are holding steady. China, the world’s largest greenhouse gas emitter, is on track to see its output grow by just 0.2 percent this year, one of the tiniest increases in years.
Bucking this trend are many developing countries like India, currently the world’s third-largest emitter. India has seen a huge increase in renewable energy deployment, but its still developing energy from all sources, including fossil fuels. The Global Carbon Budget found India’s fossil fuel emissions are on track to increase 4.6 percent this year.
There are a few additional factors that drove up emissions this year. The lingering effects of El Niño helped push global temperatures to record highs. Extraordinary heat waves in India and China pushed up energy demand for cooling, and that meant burning more fossil fuels. “We’re beginning to see some of those negative feedback loops where the climate crisis itself is impacting on the energy system and making it harder to reduce emissions,” Grant said.
Still, there are glimmers of good news. More than 30 countries have already managed to grow their economies while cutting carbon dioxide pollution, a clear sign that coal, oil, and natural gas are not the only paths to prosperity. These countries have already summited their emissions peaks and are now on the descent, breaking a pattern that has held for nearly two centuries.”
“There’s only so much the administration can control, however. Although Trump can take notable steps to try to increase fossil fuel production, actual upticks in oil and gas extraction will depend heavily on the private sector and the economics of the industry.
Still, while Trump faces some constraints, he has significant policy levers he can pull to encourage production of fossil fuels. Wright, Burgum, and Zeldin have also signaled they’re prepared to execute on the president-elect’s vision, including changes to drilling on public lands and speedier permitting for oil and gas projects.
“President Trump and his energy team — Mr. Burgum, Mr. Wright, Mr. Zeldin — can go to considerable lengths to make expanded production attractive and relatively easy,” Barry Rabe, a University of Michigan environmental policy professor, told Vox.”
“Alaska is an energy behemoth with massive reserves of oil, natural gas, and petroleum. It also, oddly, faces a looming natural gas shortage—not good for a state where half of electricity production depends on the stuff. The problem is that most natural gas deposits are far from population centers and pipelines to transport the gas don’t yet exist and may never be built. So, to get gas to Alaskans, you need to transport it by ship. But federal law requires that only U.S.-flagged liquid natural gas (LNG) carriers be used, and there aren’t any.”
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“A century ago, Congress passed the Merchant Marine Act of 1920 (better known as the Jones Act) to prop up the country’s shipping industry. The law “among other things, requires shipping between U.S. ports be conducted by US-flag ships,” according to Cornell Law Schools’s Legal Information Institute. The ships must also be built here. So, to move natural gas from one part of Alaska to another, you need American LNG carriers. And here we find another shortage.
“LNG carriers have not been built in the United States since before 1980, and no LNG carriers are currently registered under the U.S. flag,” the U.S. Government Accountability Office found in 2015. And while there’s lots of demand for more LNG carriers for the export market, not just for Alaska, “U.S. carriers would cost about two to three times as much as similar carriers built in Korean shipyards and would be more expensive to operate.”
U.S. Customs and Border Protection did make an exception to let foreign LNG carriers transport U.S. natural gas to Puerto Rico earlier this year, but only because the gas was first piped to Mexico before being loaded onto ships. Isolated Alaska doesn’t have that option.”
Surely, Trump won’t dishonestly take credit for this.
“The oil market could see a major supply glut in 2025 thanks to booming production from non-OPEC states like the US and sagging demand in China, according to the International Energy Agency.
The IEA said in its November Oil Market Report that the world’s oil market is on track for a one-million barrel-a-day surplus next year.
The excess is largely being driven by a weakening economy in China. Demand for oil in the world’s second-largest economy contracted for six straight months in a row as of September, IEA data shows. This accounted for the “main drag” on demand this year, the report said.
Meanwhile, the agency is predicting strong oil production among non-OPEC producers led by countries like US, Guyana, Argentina, and Brazil.
Altogether, non-OPEC producers are on track to expand oil production by 1.5 million barrels a day, it estimated. That amount is more than the agency’s forecast for world oil consumption to grow by 990,000 barrels a day next year.”
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“The US has become the largest oil producer in the world, pumping out more crude than any other country in history for the last six years in a row, according to the US Energy Information Administration. Domestic production hit a record 13.4 million barrels a day in August, according to data from the Energy Information Administration.”
In a series of panels about promoting North American gas, oil, and uranium energy in ways that will boost the economy and make North America strong and independent vis-a-vis world challenges, people are worried about the effects of Trump’s proposed tariffs which will hurt both countries’ economies and make energy more costly.
“The U.S. government has limited influence over those global prices, which are shaped by market and geopolitical factors. Gas prices dropped during the early months of the pandemic, for example, because millions of people stayed home and dramatically reduced their gas consumption. But as the Bureau of Labor Statistics documented, prices surged as society reopened and the economy started to rebound.
While energy prices have consistently been higher under Biden than they were during Trump’s first term, they have dropped from their heights in 2022, when Russia’s invasion of Ukraine sent global prices soaring. As the Agriculture Department noted in February, fuel and oil costs saw significant declines in 2023 and are expected to decline again in 2024, thanks to drops in global energy prices. U.S. oil prices in the past few days have dropped to their lowest level in two years as OPEC+ says it will increase its own oil production later this year and fuel demand in China looks weaker.
And it’s not clear green-lighting more domestic drilling would have much impact on energy costs. For one thing, the U.S. is already producing record amounts of oil and gas, not to mention renewable energy like solar, wind and hydropower. The Biden administration has also approved more permits to drill for oil on federal land than many of its predecessors, even as it moves to restrict how much federal land is available for drilling.
Several economists also told POLITICO that while energy costs are a factor in every part of the food supply chain, they’re just one of many inputs companies consider when setting prices.”
“According to Exxon’s own disclosures and an analysis conducted by IEEFA in 2022, only around 3 percent of the carbon captured there (roughly 6 million tonnes) has been permanently sequestered underground. Of the rest of the 240 million tonnes of carbon emitted over the facility’s first 35 years in operation, half has been sold to various oilfield operators for enhanced oil recovery, or EOR — a process by which oil companies inject carbon underground to get more oil out — and approximately 120 million tonnes has been vented into the atmosphere.”
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“When CO2 is actually sequestered underground, there’s no guarantee it stays there. “CO2 has a way of moving through the air, of leaking through pipelines, and because we have no cradle-to-grave tracking, we have no way of actually knowing how much is leaking, how much is really being collected, how much is hitting the wellhead, and how much is really staying underground,” Raffensperger said.
That’s not just concerning from a climate perspective, but from a public health perspective as well. Raffensperger notes that the pipelines built to transport condensed carbon from oil fields to storage facilities, or to other oil fields for EOR, are surrounded by “kill zones.”
“These are not your grandmother’s pipelines,” Raffensperger said. “They could be lethal. We talk about the kill zone or a fatality zone around a CO2 pipeline. We don’t talk about that with oil and gas pipelines. These are uniquely dangerous and underregulated.”
Following a 2020 CO2 leak and explosion in Satartia, Mississippi, that abruptly stopped cars on roadways, caused widespread dizziness and nausea, and sent several residents to the hospital, the federal Pipeline and Hazardous Materials Safety Administration began looking into rules for CO2 pipelines. They were set to finalize that rule this summer, pending review by the Office of Management and Budget and the Office of Information and Regulatory Affairs, but that deadline has been extended to fall 2024. The lack of finalized safety regulations has not stopped the permitting of CO2 pipelines, though. The Summit pipeline, a massive project that would carry carbon across five states, just got the go-ahead in June for the first step of its construction process in Iowa: seizing land through eminent domain to make way for the pipeline.”
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“Fatih Birol, executive director of the International Energy Agency, has called the industry’s plan to offset its emissions with carbon capture “fantasy.”
But the US government is all in on that fantasy now.
“[The carbon capture tax credit] 45Q is not based on net climate benefit or net CO2 reductions, it’s based on gross CO2 capture,” Blackburn, the environmental lawyer, said. “Why would you think making carbon a commodity would reduce CO2 emissions? It’s like the opposite of carbon tax, we’re actually paying them to produce more of it.””