Trump: Drill, baby, drill – US to expand oil industry under new president

US President Donald Trump has announced a series of aggressive initiatives his administration plans to introduce during its first few days in office to achieve the "America first" agenda that he advanced in last year's US presidential election.

He did so in a 30-minute inauguration speech in the Rotunda of the US Capitol in Washington, DC, on January 20.

They included expanded energy production, tough stances on border security and immigration and a review of trade policies.

Trump told his audience, which included outgoing president Joe Biden and outgoing vice-president Kamala Harris (whom he defeated in the election), he will sign a series of executive orders to effect some of the initiatives he outlined in the campaign.

One order, he continued, was to declare a national energy emergency to boost American oil and gas production and reduce consumer costs.

'We drill, baby, drill'

Trump promised the US would tap into its oil and natural gas reserves to address this emergency.

"We will bring prices down, fill our strategic reserves up again, right to the top, and export American energy all over the world.

Trump said, "We will be a rich nation again and it is that liquid gold under our feet that will help to do it."

He did not speak about US relations with Venezuela or Guyana, old and new regional energy producers respectively.

On December 21, 2023, the Venezuelan government issued the licence to NGC and Shell to developand export natural gas from the Dragon gas field to TT.

The Office of Foreign Assets Control (OFAC), which falls under the US Treasury, played a key role in granting this licence under the Joe Biden administration.

Concerns were raised about whether the Dragon project could be in jeopardy after Trump won the presidential election on November 4.

The US$1 billion Dragon gas deal was first signed between TT and Venezuela in August 2018. But it was left in limbo after the US imposed sanctions on Venezuela in 2019. Trump was president at that time.

In a letter to Trump on November 6, the Prime Minister said, "The Republic of TT and the USA share a long and enduring relationship, founded on deep ties across many sectors, including trade, security, culture and people-to-people exchanges."

Dr Rowley added, "We look forward to further strengthening our co-operation in the years ahead."

Rowley and Energy Minister Stuart Young were unavailable for comment.

In a Facebook post, Guyana President Dr Mohamed Irfaan Ali congratulated Trump on his inauguration, but did not comment on any of the initiatives Trump intended to pursue in his new administration.

"The government of Guyana looks forward to working closely with and your administration to forge stronger ties between our two nations in the years ahead."

Trump made good on his commitment to deal with border security by declaring "an emergency at the southern border."

He said he would sign an executive order to deploy troops there to "repel the disastrous invasion of our country."

Trump added, "All illegal entry will be immediately halted and we will begin the process of returning millions and millions of criminal aliens back to the places from which they came."

He vowed the US will deport anyone who has entered its borders illegally, including criminals, and cartels would be classified as foreign terrorist organisations.

Trump chastised Panama for abusing what he described as the gift of the Panama Canal, which was built in Panama by the US from 1094-1914 under president Theodore Roosevelt, by overcharging US ships that use it and allowing China to control the canal.

"We didn't give it to China, we gave it to Panama, and we're taking it back."

Trump said he would keep his promise to change the way the US trades with other countries.

"Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens."

Trump said an external revenue service will be established "to collect all the tariffs, duties and revenues." He said that would lead to massive amounts of money pouring into the US Treasury from foreign sources.

Trump did not give details of how any of those initiatives would be implemented.

Local responses to some of the policy hints that Trump gave in his speech were mixed.

In a statement, former trade and industry minister Vasant Bharath said Trump's speech set a tone which could have far-reaching implications for TT and the wider Caribbean.

"For TT, this could mean reduced revenue from LNG and petroleum exports as global supply increases and prices remain suppressed, as well as increased competition for energy markets, especially in the US, which is both a major buyer and competitor."

Bharath was concerned that Trump's previous hardline stance on Venezuela in his first presidency could "create significant hurdles and complicate TT's ability to proceed with cross-border projects like Dragon and Coquina (-Manakin), as any financial transaction involving Venezuela's state-owned (energy company) PDVSA could violate US sanctions."

TT, he continued, faces a delicate balancing act of managing its energy needs while maintaining its strategic relationships with the US and navigating the risks of working with Venezuela.

"Strategic planning, robust diplomacy and contingency energy strategies will be critical for TT to mitigate these challenges."

Bharath said tough immigration laws and increased deportations could see Caribbean nations, including TT, facing an influx of deportees which could strain their social services and potentially increase unemployment and crime.

"There may also be challenges for citizens of TT living in the US, particularly those without legal status."

Bharath said stricter visa regulations could make it more difficult for Caribbean nationals to work, live and study in the US.

He added many Caribbean countries depended on remittances from theses people as a vital source of income.

Bharath said Trump's focus on renegotiating or withdrawing from trade deals could affect Caribbean exports.

He asked how that would affect manufactured goods like ammonia and methanol which TT exports to the US.

Bharath said if the US took a stronger interest in controlling or influencing the Panama Canal as part of its trade strategy, Caribbean ports might see increased competition as US-Asia trade routes bypass regional ports and changes in canal policies, or tariffs could affect shipping costs, "impacting TT and Caribbean trade."

In a statement, former foreign affairs minister Winston Dookeran said Trump's speech was delivered with precision, had good political effect and was aspirational.

He added Trump's comments on energy, tariffs, trade and the Panama Canal reflected issues he raised in last year's presidential campaign.

"Each of these 'actions' is based on his 'America first' doctrine, in a transactional mode, in his style of governing."

Dookeran said while this might work for Trump, "The complexities of delivery may surface in other branches of the American political process."

In a statement, the American Chamber of Commerce (Amcham) said, "We will assess new policies as they are rolled out and always strive to add our voice in a manner that leads to fostering greater trade and investment between our countries."

Amcham added as a non-partisan business organisation, it looked forward to working directly with the Trump administration and in collaboration with 25 other American business chambers in the Western Hemisphere and its partner, the US Chamber of Commerce.

"Undoubtedly there will will be some adjustment required in TT's engagement with the new administration."

Amcham said Trump's first administration was focused more on bilateral, transactional inter-state relations.

"This will likely be a challenge for Caricom as a bloc and will require skillful manoeuvring to ensure our interests can be advanced in what will likely be a very different and dynamic set of relations within the hemisphere."

Last November, UWI economist Dr Marlene Attzs said a Trump presidency could have mixed effects on the economy.

As an oil and gas producer, she said TT could be harmed by lower global energy prices at which to sell its exports, in the likely event that Trump creates a flood of shale oil and gas.

"Changes in their policy mean shale oil and gas can affect global prices and have knock-on effects for us in the Caribbean."

Attzs said this may depress fuel prices to the benefit of Caribbean countries which are energy consumers, but will not be helpful to countries like TT which are energy producers.