Breaking Down Donald Trump’s Call for ‘Energy Dominance’

Breaking Down Donald Trump’s Call for ‘Energy Dominance’

WASHINGTON — President-elect Donald Trump is preparing to establish a National Energy Council, aiming to position the U.S. as a global leader in energy production. This initiative reflects his intention to ramp up oil and gas drilling operations while distancing himself from President Joe Biden’s emphasis on climate initiatives.

The council, expected to be headed by North Dakota Governor Doug Burgum—Trump’s nominee for the Interior Department—will play a pivotal role in fulfilling Trump’s commitment to “drill, drill, drill.” The goal is to increase energy exports to allies in Europe and worldwide.

This new council will have extensive authority over federal agencies related to energy operations, including permitting, production, and regulation. Trump has stated that the council’s mission will be to eliminate bureaucratic hurdles, attract private investments, and prioritize innovation over what he perceives as excessive regulation.

However, Trump’s ambitions for energy dominance may face practical challenges. Under Biden’s administration, U.S. oil production has already reached historic highs. Moreover, the federal government lacks the power to compel companies to increase drilling, and any rise in production could lead to lower prices and diminished profits.

The concept of energy dominance, which Trump also championed during his initial presidency, is viewed by some analysts as more of an opportunity than a mandate for the oil industry. Kevin Book, an energy analyst, suggests that the industry may be encouraged to pursue drilling projects under conditions that are likely to be more favorable compared to those under Biden’s policies.

Ultimately, whether Trump can achieve energy dominance will depend on decisions made by private companies, which will be influenced by their perceptions of supply and demand in the global market, according to Book, managing partner at ClearView Energy Partners. An immediate surge in new oil drilling operations across the country is not expected.

Trump’s efforts to increase oil availability and reduce U.S. prices are further complicated by his recent threat to impose a 25% import tariff on Canada and Mexico, two of the largest suppliers of oil to the U.S. The oil industry has cautioned that these tariffs could lead to higher prices and potential risks to national security.

“Canada and Mexico are our primary energy trade partners, and ensuring the smooth exchange of energy products across borders is crucial for North American energy security and U.S. consumers,” stated Scott Lauermann of the American Petroleum Institute, the leading lobbying group for the oil sector.

Similarly, the American Fuel & Petrochemical Manufacturers, representing U.S. refineries, voiced opposition to potential tariffs, emphasizing that American refiners rely on crude oil from Canada and Mexico to produce affordable fuels for consumers.

Scott Segal, a former official from the Bush administration, noted that the decision to centralize energy policies at the White House mirrors Biden’s approach, who appointed a team of advisors for climate policy. Segal described Burgum as “a steady hand on the tiller,” given his experience in both fossil fuels and renewable energy sectors.

In contrast to Biden’s climate advisors—Gina McCarthy, John Podesta, and Ali Zaidi—Burgum is anticipated to serve as a Senate-confirmed Cabinet member.

Dustin Meyer, senior vice president of policy, economics, and regulatory affairs at the American Petroleum Institute, remarked that the formation of the new energy council is “a positive development” for the U.S. economy and trade, advocating for enhanced coordination across energy sectors.

However, Meyer emphasized that “market dynamics will always be the crucial factor” for any potential rise in energy production.

Jonathan Elkind, a senior research scholar at Columbia University’s Center on Global Energy Policy, referred to energy dominance as a “deliberately vague concept.” He expressed skepticism about Trump’s ability to increase oil production in an already saturated market.

Trump has claimed he would lower gasoline prices to below $2 a gallon, but experts consider this goal implausible without a significant drop in crude oil prices. As of Wednesday, national gas prices averaged $3.07, a decrease from $3.25 a year earlier.

Elkind and other experts hope that the new energy council will also prioritize renewable energy sources such as wind, solar, and geothermal, along with nuclear power, as these options do not emit greenhouse gases that contribute to climate change.

“Neglecting climate change, which poses an existential threat to our planet, is a serious concern and could lead to significant losses in both American property and lives,” Elkind warned. He cited federal data indicating that this year alone, over two dozen weather-related disasters caused damages exceeding $1 billion each and resulted in 418 fatalities.

Trump has downplayed the dangers associated with climate change and has pledged to eliminate unspent funds from the Inflation Reduction Act, Biden’s key climate and healthcare legislation. He has also stated intentions to halt offshore wind development upon his return to the White House in January.

Despite this, his announcement on November 15 regarding the energy council emphasized a commitment to “expand ALL forms of energy production to boost our economy and create high-paying jobs.”

This statement included a nod to renewable energy, as noted by Safak Yucel, an associate professor at Georgetown University’s McDonough School of Business.

“The council is mandated to ensure U.S. dominance globally, but what could be more American than solar and wind energy?” he questioned, referencing a report from Ernst & Young that identified solar energy as the most cost-effective new source of electricity in numerous markets.

Trump has stated he aims to significantly increase baseload power to lower electricity costs, prevent blackouts, and “WIN the battle for AI superiority.”

Before his appointment to the energy role, Burgum highlighted a similar objective, pointing to the rising demand for electricity driven by artificial intelligence and rapidly expanding data centers. “The AI competition impacts everything from defense to healthcare to education to national productivity,” Burgum stated.

While Trump has derided the climate law as the “green new scam,” experts believe he is unlikely to fully dismantle it. One reason is that a significant portion of its investments and job creation occurs in Republican districts. GOP lawmakers have urged House Speaker Mike Johnson to maintain the law, which was passed solely with Democratic support.

“Many Southern states are advising Trump that they actually favor renewables,” Yucel noted, pointing out that Republican-led states have seen substantial job growth in wind, solar, and battery sectors in recent years.

If renewables continue to make economic sense, he concluded, “they will persist.”