Oil and gas executives met with President Donald Trump at the White House on Wednesday as they seek to influence him on tariffs, tax credits and deregulation.
Some executives in the industry, which spent more than $75 million to help elect Trump, are increasingly frustrated with his agenda. Tariffs are making essential materials like steel pipe more expensive while also rattling consumer confidence.
Oil prices have fallen around 14% since just before Trump took office, to less than $67 a barrel. Peter Navarro, a senior White House aide, has talked about the benefits of oil that sells for just $50 a barrel. At such prices, companies operating in wide swaths of the American oil patch would lose money drilling new wells.
Here are some of the industry’s priorities:
Tariffs
U.S. refineries buy oil from Canada and Mexico, transform it into fuels like gasoline, then export those more valuable products. These trade ties were formed over decades and would be difficult and expensive to untangle.
Trump announced 25% tariffs on imports from Canada and Mexico with a lower, 10% rate for Canadian energy products. But this month he delayed those tariffs on most goods, including energy imported under a North American trade agreement Trump negotiated during his first term. That reprieve is set to end in early April.
The 25% tariff on imported steel that took effect this month is also a big concern for executives. The metal is used in everything from pipelines to wells, and it is getting more expensive because of the tariff. Some executives remain hopeful that they will able to secure exemptions, though Trump has rebuffed that idea.
Permitting reform
Energy companies are pushing Trump and Congress to ease permitting rules to make it easier to build transmission lines, pipelines and other infrastructure. Many companies want to make it more difficult for states to block proposed projects and for environmentalists and others to tie them up in court.
“If you want more energy in the United States and you want more investment in the United States, we’ve got to be able to build things again. I’ve heard that repeatedly,” Chris Wright, the new U.S. energy secretary, said last week, summarizing feedback from executives he met at the CERAWeek by S&P Global conference in Houston. “My answer is: Give me specifics. What permit? What was the thing?”
Natural-gas exports
Earlier Wednesday, the Energy Department awarded conditional approval to a large natural-gas export project on the Gulf Coast, known as CP2 LNG. This is an area where oil and gas companies and the Trump administration are aligned: Both want to sell more natural gas abroad.
President Joe Biden paused permitting in January 2024 to study how the projects would affect climate change, among other concerns.
Natural gas is mostly made up of methane, a potent greenhouse gas that can leak from wells, pipelines and other infrastructure. Burning natural gas also produces carbon dioxide, another greenhouse gas, though far less compared with burning coal.
The Biden administration ultimately found that a big increase in U.S. exports could cause global greenhouse gas emissions to rise modestly and create pollution in communities near export terminals. A separate study released this month by S&P Global found that greater U.S. exports would help keep a lid on global emissions because the gas would displace other, dirtier sources of energy.
The developer of CP2, Venture Global, had been waiting more than three years for the Energy Department’s approval. The department said Wednesday that it was granting approval because the project would help the U.S. economy and contribute to the energy security of the country and its allies.
Tax credits
Some oil and gas companies want to preserve clean energy tax credits for producing hydrogen and renewable fuels, as well as capturing and storing carbon dioxide, the leading cause of climate change.
Vicki Hollub, CEO of Occidental Petroleum, a large U.S. oil company that has been building a carbon capture plant in West Texas, is pushing to preserve federal incentives for removing the greenhouse gas from the air. That tax credit is known as 45Q based on its place in the tax code.
“To accelerate the technology at the pace that the U.S. needs it to accelerate to start having a positive impact on our energy independence, we need 45Q to happen and to stay in place,” Hollub said at CERAWeek.
This article originally appeared in The New York Times.
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