Energy Secretary Chris Wright stated on Thursday that the oil market is not fully acknowledging President Donald Trump’s efforts to boost crude and gas production in the U.S.
“The market is clearly adjusting to the fact that producing oil and gas in the United States is becoming easier,” Wright shared with CNBC’s “Squawk Box”. “This increase in supply is leading to a decrease in prices for oil, gasoline, and home heating fuels, which benefits the American public.”
Since Trump took office on January 20, U.S. crude oil futures have dropped nearly 14%. Energy policy has been a key focus for Trump, who aims to enhance oil and gas production alongside plans to expedite leasing on federal lands and streamline the permitting process.
Recent tariffs and OPEC strategies have been influencing the oil market negatively, as concerns grow over potential price hikes and slower economic growth. On March 5, West Texas Intermediate price fell to an intraday low of $65.22, the lowest since spring 2022, following Trump’s announcement of a 25% tariff on imports from Canada and Mexico. The president later exempted goods aligned with the North American trade agreement until April 2.
Chevron CEO Mike Wirth and ConocoPhillips CEO Ryan Lance remarked at an energy conference in Houston last week about their anticipation of U.S. oil production stabilizing after record highs achieved during the Biden administration. Wirth emphasized that Chevron prioritizes financial discipline over mere production increases.
“Pursuing growth for its own sake hasn’t been effective for our sector,” Wirth asserted during the CERAWeek by S&P Global Conference. “Eventually, growth should level off, allowing for increased free cash flow instead of merely producing more barrels.”
OPEC+ also intends to commence production increases in April, gradually returning 2.2 million barrels per day to a market currently experiencing oversupply.
On Wednesday, Trump, Wright, and Interior Secretary Doug Burgum met with oil and gas executives at the White House, with Wright indicating a new collaborative approach with the industry, stating that they “no longer bear a scarlet letter on their forehead.”
In recent days, U.S. crude oil prices have seen slight increases as Trump has initiated airstrikes on Houthi targets in Yemen and has pledged accountability for any future assaults by Iran-backed groups. On Thursday morning, West Texas Intermediate was priced at $67.11 per barrel.
Given that Iran is part of OPEC, any increase in tensions with the country raises concerns regarding potential supply disruptions. Trump is actively seeking to zero out Iran’s oil exports to compel the Islamic Republic to negotiate a nuclear deal.
