President Donald Trump said Tuesday that the “war” on American energy is over in a State of the Union speech given as US crude oil output is set to reach levels not seen in more than 47 years, Platts reports.
The speech barely touched on energy. Trump did not even mention oil and much of the growth in US output took place under the Obama administration. But this month, US production is expected to average more than 10 million b/d for the first time since November 1970. The output jump is already altering US foreign relations and bolstering the Trump administration’s calls for energy “dominance” as opposed to the rhetoric of previous administrations to be energy independent.
However, those watching the path of US crude production closely remain uncertain over just how much America’s relatively newfound supply wealth benefits future diplomatic efforts and how much influence US producers can possibly have over the ever-growing global oil market. In addition, domestic infrastructure constraints, shifting trade policy, and mounting demand could all blunt the impact of the increase in US output.
Furthermore, growing domestic supply has compelled the Trump administration to disregard years of diplomatic efforts to maintain stability in producing countries such as Nigeria and Angola. This, combined with declining investment in exploration and production projects outside of shale plays, could compound a future supply disruption.