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The Biden administration’s heavy emphasis on clean energy and electric vehicles is gone.
Upon his inaugural address, newly elected President Donald Trump pledged to do away with EV mandates, and instead publicly embraced the fossil-laden Drill Baby Drill mantra.
He has pledged to roll back fuel efficiency requirements known as CAFE (corporate average fuel economy) standards, which requires automakers to make cars and trucks that yield more miles per gallon. And Trump has called on America to be the great exporter—not importer—of fuel.
While it’s premature to see how all of this plays out, there is much to consider.
Oil Production
According to the U.S. Energy Information Administration, energy production will stay mostly flat, rising less than 1% in 2026.
If Trump presumably paves the way for more domestic drilling, including in the pristine Alaskan Arctic National Wildlife Refuge (ANWR), why would major oil producers hold off?
Several reasons, ranging from prohibitive upstream costs to projected long-term downstream demand.
In lay terms, have you noticed that gasoline prices—excluding short-term disruptions from hurricanes and other major weather events—have been remarkably stable over the past 18 months, with motorists across most of the country paying less than $3 a gallon?
Well, national experts believe that’s unlikely to change in the foreseeable future.
According to EIA, “We expect downward oil price pressures over much of the next two years, as we expect that global oil production will grow more than global oil demand.”
The agency expects crude oil prices to fall 8% in 2025 and another 11% in 2026.
As for domestic oil production, after hitting a record 13.2 barrels per day in 2024, EIA expects a slight uptick to 13.5 million barrels per day this year, and just 13.6 million—less than 1% in 2026.
Projects favored by Trump in the Gulf of Mexico and Alaska’s frontier areas cost billions of dollars in infrastructure and have decade-long timelines.
If EIA’s forecast proves true, such investments, oil experts say, are unlikely. Then again, few things in life are as historically tumultuous as global politics and the fragility of fuel stability.
Mitch Morrison is vice president of retailer relations at Informa Connect. Reach him at mitch.morrison@informa.com.
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