Will Trump’s Win Be a Win for Oil?

Anti-Trump campaigners haven’t been shy about expressing their disgust over a Trump presidency. Across America, protestors have taken to the streets with signs declaring that “Trump is not my president.” But love him or hate him, some economic analysts assert that Donald Trump could work fiscal magic for the USA.

Trump vows to stir the USA oil pot

During his fierce campaign against Hilary Clinton, Trump promised to “Make America Great Again.” In a move that devastated environmentalists, he pledged to cancel billions of dollars of funding towards the United Nations climate change programs, and instead redirect the cash into USA based infrastructure projects. He also plans to lift restrictions on fracking, which open up leases for onshore and offshore federal lands.

Barriers preventing the construction of the Keystone Pipeline will also be lifted, which would see oil flow freely between Alberta and Nebraska. He’s also vowed to remove the US from agreements to cap fossil fuel emissions. These are all key parts of a plan to boost oil and natural gas production in the USA, revive the nation’s flailing energy industry and tap into an estimated US$50 trillion of unexploited shale, oil, natural gas and coal. Needless to say, oil and gas investors are ecstatic.

"The Energy Industry will be very happy as a president Trump will take a harder line with OPEC and revisit things like the Keystone Pipeline that started the anti-pipeline movement in this country that threaten to lead to shortages of supply and sharply higher energy costs down the road," comments Phil Flynn, senior market analyst at the Price Futures Group.

Trump presidency triggers short-term oil price crash

When it became clear that Trump was on track for a surprise victory, crude prices tumbled to nearly US$43 barrel, which represents a shocking 4% drop and a near two-month low. The slump was triggered by Trump’s unpredictability, which saw investors frantically sell off risky assets such as oil and gas stocks. Though on Wednesday morning prices were once again edging higher, with the US dollar bouncing back from an initial drop.

Despite his lofty intentions and his reputation as one of the most successful businessmen on the planet, Trump’s White House win hasn’t got everyone convinced that oil prices will recover, or that production in the USA will rise. 

"The outcome of the U.S. election adds to the challenges for the oil exporters because it will likely lead to weaker economic growth in an already fragile global economy," warns Daniel Yergin, Pulitzer Prize-winning author and vice chairman of IHS Markit.

Ticking time bomb, or economic goldmine?

With Trump set to take office as America’s 45th president on January 20 2017, the lead up to Inauguration Day will be interesting, to say the least.

For more information on the latest controversy surrounding the oil industry, ‘Who’s Manning the Cash Register? Part 2’ is a fantastic sequel to its predecessor. The article spotlights tank gauging for custody transfer, and explores the benefits of installing a LACT (Lease Automatic Custody Transfer) unit or an ACT (Automatic Custody Transfer) unit.