Trump takes office seeking sweeping energy agenda
Trump has nominated a Cabinet with background in the oil and gas sector to help pursue an "America first" energy policy.
That policy envisions tapping into natural resources on public land, removing regulations and achieving "independence" from the need to import energy from Opec and countries seen as hostile to US interests.
"We stand at the birth of a new millennium, ready to unlock the mysteries of space, to free the earth from the miseries of disease and to harness the energies, industries and technologies of tomorrow," Trump said today in his inaugural address.
Within the next few days, Trump is poised to start the process of unraveling environmental regulations that former president Barack Obama's administration spent the last eight years putting into place. Trump during his first days in office can halt last-minute rules that have not been published, rescind climate-related executive orders and issue orders outlining policies on energy and the environment.
But it could take months or years to rescind major regulations such as the Clean Power Plan and other administration efforts to reduce emissions of greenhouse gases and other pollutants. Those rules may require a time-consuming process to rescind, and any changes could be tied up in court for years.
The new administration is set to have deep ties to the oil and gas sector. Trump has nominated ExxonMobil's former chief executive Rex Tillerson to lead the State Department and Oklahoma attorney general Scott Pruitt, who has sued to block the Clean Power Plan, to lead the Environmental Protection Agency. Former Texas governor Rick Perry has been tapped as US energy secretary.
Those nominees, if confirmed by the Senate, could help Trump live up to promises to expedite permitting of pipelines, support coal mining and expand the energy sector to create new jobs in domestic manufacturing. Trump has said he would lift roadblocks on energy production and allow projects such as the 830,000 b/d Keystone XL crude pipeline to move forward.
The incoming administration could bring in a new era of unpredictability in foreign and domestic policy. Trump today offered few signs of moderating the brash, anti-establishment message he honed during his campaign. "For too long, a small group in our nation's capital has reaped the rewards of government while the people have born the cost," he said. He said that US policy will be centered around the tenet of "America First."
The administration's energy agenda will be aided by Republican majorities in Congress eager to push ahead with legislation they have been unable to advance under Obama. Republicans next month plan to start repealing recent coal mining rules and restrictions on flaring. Republicans also want to overhaul the US tax code and create a "border adjustment" tax that has unnerved some energy companies.
Ambitions by Congress to weaken or rewrite landmark environmental statutes such as the Clean Air Act, the Clean Water Act or the Endangered Species Act will face opposition from Democrats, who under existing rules can still filibuster to block bills in the Senate. Republicans may need to tailor their agenda into must-pass legislation and other bills that only need a simple majority to pass.
And decisions made in foreign capitals still affect the fortunes of the US producers to a greater degree than any changes in Washington. The US shale oil industry was decimated, but survived, after Opec decided in November 2014 to pursue a market share strategy. And the recent uptick in drilling activity follows Opec production cut discussions in Algiers and Vienna last fall.