Behind the Money
Why Big Oil is resisting Trump’s call to ‘drill, baby, drill'
Feb 5, 2025
Amanda Chu, a Financial Times reporter specializing in the U.S. energy sector, discusses the tensions between President Trump’s push for increased oil production and the reluctance of major oil companies. She highlights how the shale revolution reshaped the industry, revealing the conflicting priorities between profit-driven investors and political demands. The conversation also delves into the impact of low oil prices, regulatory changes, and proposed tariffs on Mexico and Canada, emphasizing the complex dynamics shaping today’s oil market.
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Quick takeaways
- Despite President Trump's push for increased oil production to combat inflation, major oil companies prioritize shareholder returns and cautious spending.
- Current market conditions, including low oil prices and reduced global demand, lead oil companies to avoid aggressive expansion despite political pressure.
Deep dives
Record Oil Production in the U.S.
The United States has achieved record-breaking oil production, pumping more than 13 million barrels per day, surpassing any other country in history. This surge is largely attributed to advancements stemming from the shale revolution, which began around 2010 when new drilling technologies made it feasible to extract oil from previously untapped shale formations. Despite the U.S. being in a favorable position within the global oil market, President Trump’s administration has called for even higher production levels. However, the current market conditions and investor sentiments suggest that maintaining production levels is more feasible than aggressive expansion.
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