Trump celebrates new Gulf of America oil field

The rules put in place during the Biden administration were crippling for the gas and oil industry, and we are now seeing the damage being done in terms of production.

Oil and gas production are way down early in Trump’s second term, but Trump is hoping a new development will change that. 

No more permits

Administrations are required to hold a certain number of oil and gas leases every year, but Biden put a halt to new leases right after taking office.

As soon as Biden got the keys to the White House, he suspended all new leases for 60 days, but that suspension more or less lasted his entire term.

At the time, National Wildlife Federation Vice President Tracy Stone-Manning stated, “The Biden administration has made a commitment to driving down carbon emissions. It makes sense starting with the land that we all own. We have 24 million acres already under lease. That should get us through.”

We really would not see the damage done to production for years, as it would take time for some existing wells to dry up, and that is what we are seeing now. We also have to consider how much more expensive Biden made it to produce oil with the added regulations, which is why we are now seeing a fall in production.

Lower production

Trump is unfairly taking a beating by the media over a massive drop in oil and gas production, which is technically due to the rules put in place during the Biden administration, many of which significantly increased the cost of producing a barrel of oil.

During Trump’s first 100 days in office, oil prices collapsed, well below the target of $65 per barrel, so oil production is not profitable right now.

SLB CEO Olivier Le Peuch stated, “In this environment, commodity prices are challenged and until they stabilize, customers are likely to take a more cautious approach to near-term activity and discretionary spending.”

Baker Hughes CEO Lorenzo Simonelli added, “The prospects of an oversupplied oil market, rising tariffs, uncertainty in Mexico and activity weakness in Saudi Arabia are collectively constraining international upstream spending levels.”

Flipping it

A new venture between an American company and a French company has finally come to fruition in the Gulf of America (formerly the Gulf of Mexico).

Trump celebrated the first production of oil from the field, with the White House stating, "President Trump’s agenda is restoring America’s energy dominance, resulting in a new oil partnership to the Gulf of America to ‘Drill, Baby, Drill.’

"New oil production will continue to increase because energy leaders are confident in the president’s commitment to unleash American energy, roll back stifling regulations, reduce our reliance on foreign countries’ dirty oil, and deliver economic relief to the American people.”

For Trump, getting production up is only one half of the equation, as he also needs to try to get rid of some of Biden’s regulations to make production more cost-effective to these swings in prices do not hurt the industry. If not, we are soon going to be looking at a shortage of product solely so the industry can allow demand to catch up to supply. And if that happens, the GOP may not recover in time for the 2026 election.