During his campaign and since taking office, President Donald Trump often repeated his desire to bring back the same “drill, baby, drill” oil and gas agenda that characterized his first term in office.
But that term began 8 long years ago and much has changed in the domestic oil business since then. Current market realities are likely to mitigate the industry’s response to Trump’s easing of the Biden administration’s efforts to restrict its activities.
Trump’s second term begins as the upstream segment of the industry has enjoyed three years of strong profitability and overall production growth by employing a strategy of capital discipline, technology deployment and the capture of economies of scale in the nation’s big shale play areas. Companies like, say, ExxonMobil and Oxy and their peers are unlikely to respond to the easing of government regulations by discarding these strategies that have brought such financial success in favor of moving into a new drilling boom.
This bias in favor of maintenance of the status quo is especially likely given that the big shale plays in the Permian Basin, Eagle Ford Shale, Bakken Shale, Haynesville and the Marcellus/Utica region have all advanced into the long-term development phases of the natural life cycle typical of every oil and gas resource play over the past 175 years. Absent the discovery of major new shale or other types of oil-or-natural gas-bearing formations, a new drilling boom seems quite unlikely under any circumstances.
One market factor that could result in a somewhat higher active rig count would be a sudden rise in crude oil prices, if it appears likely to last for a long period of time. Companies like Exxon, Chevron, Oxy and Diamondback Energy certainly have the capability to quickly activate a significant number of additional rigs to take advantage of long-term higher prices.
But crude prices are set on a global market, and that market has appeared over-supplied in recent months with little reason to believe the supply/demand equation will change significantly in the near future. Indeed, the OPEC+ cartel has been forced to postpone planned production increases several times over the past 12 months as an over-supplied market has caused prices to hover well below the group’s target price.
But it is wrong to think the domestic oil industry will not respond in any way to Trump’s efforts to remove Biden’s artificial roadblocks to energy progress. Trump’s efforts to speed up permitting for energy projects of all kinds are likely to result in a significant build-out of much-needed new natural gas pipeline capacity, natural gas power generation plants and new LNG export terminals and supporting infrastructure.
Instead of another four years of “drill, baby, drill,” the Trump efforts to speed energy development seem certain to result in four years of a “build, baby, build” boom.
Indeed, the industry is already responding in a big way in the LNG export sector of the business. During Trump’s first week in office, LNG exporter Venture Global launched what is the largest energy IPO by value in U.S. history, going public with a total market cap of $65 billion.
With five separate export projects currently in various stages of development, all in South Louisiana, Venture Global plans to become a major player in one of America’s major growth industries in the coming years. Trump’s Day 1 reversal of Biden’s senseless permitting pause on LNG infrastructure is likely to kick off a number of additional LNG projects by other operators.
The Trump effect took hold even before he took office when the Alaska Gasline Development Corporation entered into an exclusive agreement in early January with developer Glenfarne to advance the $44 billion Alaska LNG project. The aim is to start to deliver gas in 2031, with LNG exports following shortly thereafter.
America’s oil and gas industry has demonstrated it can consistently grow overall production to new records even with a falling rig count in recent years. Now it must grow its related infrastructure to account for the rising production.
That’s why Trump’s “drill, baby, drill” mantra is likely to transform into “build, baby, build” in the months and years to come.
David Blackmon is a contributor to The Daily Caller News Foundation, an energy writer, and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
The 2025 Free Enterprise Report from the Common Sense Institute Arizona (CSI) was released Monday and ranked the state of Arizona amongst the states in education as well as the new indexes of economic performance and economic momentum.
According to Katie Ratlief, Executive Director of CSI Arizona, “Arizona continues to lead the way in key areas like tax policy, state budgeting, and educational choice, proving the impact of data-driven, common-sense policies.”
“However,” she added, “challenges in housing, public safety, and homelessness are beginning to slow our momentum. While Arizona remains a top destination for growth, addressing critical issues like crime and the housing crisis will be essential to sustaining our competitiveness. Fortunately, the policies that fueled much of Arizona’s success are still in place, and with a renewed focus on data-driven solutions to address issues like crime and housing, Arizona can solidify its position as one of the most competitive states in the nation for years to come.”
The report details Arizona’s positioning in the emerging recovery of 2025, particularly highlighting the success of the state and its persistent momentum. In an overall measure, the state ranked 27th in “free enterprise competitiveness,” with CSI emphasizing advances in taxes, state budgeting, energy and education, but noting the heavy limitations imposed by housing shortages and rising costs.
In education, Arizona ranked second in the nation in share of students enrolled in school choice options, seemingly ratifying the state’s first-in-the-nation universal Empowerment Savings Account (ESA) program which now provides financial support to over 83,000 families.
Arizona is leading the charge in school choice. Arizona ranks 2nd in school choice enrollment and 1st in education spending efficiency, according to CSI's 2025 Free Enterprise Report. While there's still room to improve graduation rates and test scores, the future of education in… pic.twitter.com/JNK1pbEOwC
— Common Sense Institute Arizona (@CSInstituteAZ) January 13, 2025
The report noted, “Arizona today has the most open K-12 educational market in the country, and hosts a diverse network of District, Charter, and private school options. Since the pandemic, its home- and microschool space has expanded rapidly. Today, about a third of Arizona’s K-12 students are not enrolled in the traditional District school system.”
The report also highlighted Arizona’s Energy situation, noting in a post to X, “Arizona remains a top 20 state for energy competitiveness, boasting one of the most reliable electricity grids in the nation.”
Arizona remains a top 20 state for energy competitiveness, boasting one of the most reliable electricity grids in the nation. Learn more about the state's energy competitiveness in CSI's 2025 Free Enterprise Report.
— Common Sense Institute Arizona (@CSInstituteAZ) January 14, 2025
CSI explains, “Thanks to maintaining the nation’s largest nuclear power plant and the moderate and deliberate pace of adoption of wind and solar energy sources (supplemented by robust investment in natural gas), the state’s electrical grid remains reliable and affordable.”
Finally, Arizona’s advantageous tax system was highlighted with the 2.5% flat income tax and property tax instant depreciation of business investments cited in particular for contributing to an extremely competitive tax and regulatory system. Arizona ranked 7th in the nation on the Taxes & Fees Competitiveness Index.
The report observed, “Arizona has significantly reduced its tax burden in recent years, most notably by adopting a 2.5% flat personal income tax rate. This reform cut the top marginal tax rate from 4.5% to 2.5%, simplifying the tax code and making Arizona one of the most competitive states for income taxation.”
Looking to the future, CSI pointed to the steps Arizona legislators have taken to insulate the state against capricious tax hikes, explaining “this tax structure is well protected. Rules requiring supermajorities for statewide tax increases by the State Legislature were extended in 2022 to initiatives and referendums that would have voters approve the tax increases.” The report continues, “Arizona’s competitive ranking for its tax structure is not only unlikely to get worse but may improve (even if further reform is more incremental) due simply to the relative erosion of the position of other states that lack these structural protections.”
The nation may see the benefits of hydropower expansion in Arizona, depending on President Joe Biden’s approval of an Arizona congressman’s bill.
That bill, HR 1607 from Congressman David Schweikert, transfers National Forest System land near the Salt River in Arizona to the Bureau of Reclamation for the purpose of additional hydropower generation within the Salt River Federal Reclamation Project.
In remarks before the House last year, Schweikert explained that pumped storage hydroelectricity supplements energy resources in the state.
“It’s environmentally sound, it actually allows us to take care of something that is somewhat unique for us in the desert southwest, and that is the solar power we produce,” said Schweikert.
Pumped storage hydroelectricity pumps water from a lower reservoir to an upper reservoir during low energy demand. During high energy demand, the upper reservoir releases downhill into the lower reservoir through hydropower turbines to generate around 10-12 hours of reliable energy.
In a press release, Schweikert said the legislation proved Arizona’s standing as a state leading on energy production and efficiency.
“Once again, Arizona has proven to lead the charge to deliver innovation and make life more efficient for Arizonans at a time when our state’s economy and population continue to explode,” said Schweikert. “The near unanimous support for this legislation proves that America is ready to embrace long-term energy storage technologies to expand the supply of affordable and reliable energy for our communities.”
Schweikert thanked his Democratic colleague, Congressman Greg Stanton, for his assistance in getting the bill passed with bipartisan support.
“I’m incredibly thankful for my friend and colleague, Rep. Stanton, who’s been crucial to this process of embracing innovation, and I’m looking forward to seeing this technology benefit Arizona,” said Schweikert in the press release.
Stanton contributed a statement to Schweikert’s press release, adding that the pumped storage hydroelectric expansion couldn’t come at a better time.
“Not only do pumped storage projects provide greater flexibility and improve reliability in our energy grid, but they also cut utility costs for Arizona families and businesses,” said Stanton. “This critical legislation passed the House with an overwhelming majority last year, and today it’s on its way to becoming law.”
It was a bipartisan coalition of elected leaders that ensured the passage of Schweikert’s bill. Both the House Natural Resources Committee and the Senate Committee on Energy and Natural Resources passed the legislation unanimously.
Schweikert introduced the bill last March. The House passed the bill last November, where it awaited Senate review for over a year. The Senate approved the bill on Tuesday. Arizona Senators Mark Kelly (D) and Kyrsten Sinema (I) introduced companion legislation in March, SB 739, which has advanced to Biden’s desk.
Kelly said in the press release that the expansion would not only strengthen the state’s energy grid but result in lower energy costs for Arizonans.
“Expanding pumped-storage hydropower in Arizona will strengthen our energy grid and lower energy costs for families,” said Kelly. “This is about using technology to make our energy more reliable and affordable.”
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“It’s an absolutely sh*t situation.” That is the assessment of Norway’s energy minister, Terje Aasland, about his country’s electricity costs rising to record levels due to its exports of power to the United Kingdom, Germany, Denmark and other European countries.
It is an outcome that many warned the Norwegian government would come about as the decisions were made to build the interconnects to export power into the European Union and the UK. Those critics were of course ignored as those in charge of Norway’s fortunes at the time felt compelled to genuflect to the demands of the EU and other globalist organizations.
Norway derives the vast majority of its electricity from hydropower, which currently provides 90% of the country’s power generation. Most of the remainder comes from wind power, and the nation enjoys a large excess of generating capacity on most days. Thus, all other factors being equal, it made some financial sense to establish those interconnects to sell the surplus into other countries.
But it only made sense when those other countries were taking care to ensure the continuing health and adequacy of their own electric grids. That certainly has not been the case in either the UK or Germany, whose governments have in recent years chosen to discard a former wealth of reliable baseload capacity provided by coal and nuclear plants in favor of relying too heavily on intermittent, weather-dependent wind and solar.
Now, when the wind stops blowing and the sun isn’t shining, those customers of Norwegian power exports drain the host country’s surplus, causing the extremely high energy costs to flow back upstream, hitting Norwegians with abnormally high utility bills. It all came to a head this week when low wind speeds, combined with abnormally cold temperatures on the European mainland, caused power rates in Norway to spike to as high as €1.12 ($1.18) per kilowatt hour (kwh).
By comparison, the average electricity rate per kwh in New York is around 22 cents, while Texans typically pay around 15 cents per kwh. What that price spike meant for Norwegians on December 12 is that taking a 5-minute warm shower would have cost them $5. Doing the same in Texas would have cost around 16 cents.
Naturally, public outrage in Norway over these needlessly high electricity rates is now causing policymakers there to run for political cover. The Financial Times reports that both the ruling leftwing Labour Party and conservative Progress Party are now making plans to campaign next year on platforms to limit or end the export of electricity via these international interconnections.
That is a prospect that no doubt sparks fear in the hearts of the central planners in both Germany and the UK, where electricity imports from Norway play a central role in their own emissions reduction plans. Those plans involve the willful destruction of reliable baseload power stations and forcing power costs to dramatically increase, which in turn results in heavy industries like steelmaking and other manufacturing to leave the country. In that way, these governments are essentially exporting their emissions to China, whose own government is only too happy to serve as home to these heavy industries and power them with the hundreds of coal-fired power plants they build each year.
California Gov. Gavin Newsom and his fellow Democrats have pursued essentially the same strategies in California in this century, with predictable results: Californians pay among the highest power rates in the United States as their power grid has become overloaded with intermittent generation and increasingly reliant on imports from other states. Rather than exporting its emissions to China, California exports them to Nevada and Utah and other U.S. states.
The Biden administration has attempted to take the entire country down this same economically ruinous path for the past four years. Fortunately, voters awakened just in time this year to head off the most damaging impacts now being seen in Germany and the UK.
For Norway, is this an example of the law of unintended consequences setting in? Sure, to some extent. But it is also a clear example of entirely foreseeable consequences stemming from poor policymaking by multiple national governments flowing across borders. This “sh*t situation” was all avoidable, and frankly should have been.
David Blackmon is a contributor to The Daily Caller News Foundation, an energy writer, and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
Seldom have a few days of energy-related news provided a clearer illustration of the stark contrasts between the crony-capitalism-based energy policies of the Biden administration and the American energy dominance policies to come during a second Trump administration as the news from the past week.
On Nov. 26, the Biden Department of Energy led by Secretary Jennifer Granholm announced an award of $6.6 billion to struggling electric vehicle maker Rivian in the form of a low-interest loan. The infusion of capital is designed to help the company finance a new Georgia-based plant with a production capacity of 400,000 cars per year. Rivian already operates a plant in Illinois capable of turning out 150,000 units annually.
So, what is the problem, you might ask? Well, first, Rivian — like every other U.S. EV maker other than Tesla — has consistently struggled financially. The company so badly missed its sales targets in 2023 that it was forced to discount prices and layoff workers to maintain its ability to service its existing debt load.
Second is the fact that Rivian has only managed to sell a little more than 37,000 units this year as U.S. consumer demand for EVs has stalled, at a financial loss of over $107,000 per car. This begs the question why a car company struggling to sell 50,000 units per year somehow needs the taxpayers to pony up $6.6 billion to raise its production capacity to 550,000 per year, or roughly 13 times its current annual sales.
Third is the fact that Amazon, owned in large part by billionaire Jeff Bezos, is one of Rivian’s biggest investors. Bezos is currently listed as the world’s second-richest individual by Forbes, with a net worth of more than $226 billion. If pouring another $6.6 billion into Rivian is a terrific financial idea — as DOE claims — then why haven’t Amazon and/or Bezos been eager to do that?
The answer seems fairly obvious: This really isn’t a good financial idea at all. What is really happening here is the desperation last gasp of Biden era crony capitalism, shoving those billions of IRA dollars out the door before President-elect Donald Trump is sworn in and starts reining in the madness.
The day before DOE announced its award to Rivian, Trump announced plans to impose 25% tariffs on all imported goods from both Canada and Mexico if the governments in those countries do not immediately move to stop the flows of illegal immigrants and drugs across their borders with the United States. It is key to note that, when you talk about all goods coming in from Canada and Mexico, you are talking about America’s two biggest trading partners for crude oil. Canada is far and away the biggest exporter of oil into the United States, with Mexico ranking second on the list, well ahead of any OPEC nation.
The strategic objective behind announcing these tariff plans two months before being sworn into office was to give the governments of these two countries time to act quickly to slow the flows across their borders and commit to major reforms so the tariffs never have to be actually invoked. It is Trump exercising leverage in a negotiation, a skill that has made him a billionaire in his business life. It is a strategy Biden has never attempted to use related to the open borders the flow of deadly fentanyl that now kills more than 100,000 Americans annually.
Within 48 hours, Trump had held initial talks with socialist Mexican President Claudia Sheinbaum, reporting significant progress. Trump reported far more progress than Sheinbaum was willing to admit, another clear negotiating tactic.
By Friday, Nov. 29, Canadian Prime Minister Justin Trudeau was jetting down to Mar-a-Lago to hold talks with Trump on border reforms his government is willing to make to avoid the tariffs. Again, Trump is still seven weeks away from being sworn into office.
Joe Biden remains president, at least nominally, but the days of his crony capitalist approach to energy policy are running out fast, and will soon be displaced by a Trumpian return to American energy dominance. It is a change that cannot come soon enough.
David Blackmon is a contributor to The Daily Caller News Foundation, an energy writer, and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
