And the latest semi-annual survey from the Federal Reserve Bank of Dallas finds oil executives more upset than ever. They are particularly worried about President Donald Trump’s steel tariffs and anti-energy policies. Uncertainty created by these rising costs as a result of these tariffs is creating growing challenges for executives to effectively plan future projects. The utility survey was open from March 12 through the 20. Along the way, it collected invaluable first-hand information from operators in Texas, southern New Mexico, and northern Louisiana.
Participants joined anonymously on the day of, enabling executives to share more candid and controversial opinions on the existing federal administration’s top-down policies. Many cited the work of Trump’s energy team and the administration’s overall focus on increasing leasing and reducing red tape on permitting. Worries over the “drill, baby, drill” agenda were clear. This bipartisan thinking flies in the face of today’s $50 per barrel oil. Consequently, the level of uncertainty experienced an extraordinary sky high spike in last quarter.
“Uncertainty around everything has sharply risen during the past quarter.” – An oil executive
You might recall that the most recent Dallas Fed survey uncorked some sharp, almost apoplectic, criticism. This is in sharp contrast to the rosy proclamations from big oil executives at last week’s CeraWeek conference in Houston. The quarterly survey, which includes responses from about 200 of these firms, indicates a deeply troubling downward trend. Combined tariffs and energy policies would result in the removal of rigs, loss of oil industry jobs, and decrease in U.S. oil production to levels similar to during the COVID-19 pandemic lows.
…what this means for [your] industry … One executive shared his fears about the wider impact these policies have.
“The administration’s chaos is a disaster for the commodity markets.” – An oil executive
Despite some positive feedback regarding the administration’s energy team, the uncertainty surrounding Trump’s policies is causing significant challenges. White House advisors such as Peter Navarro think that the “drill, baby, drill” agenda will reduce oil prices and contribute to the fight against inflation. This is one proposal that surveyed industry experts think is totally impractical.