It's new year, new president, new optimism for the energy industry after three years of doldrums. Oil prices are drifting upward again, thanks in part to OPEC announcing a production cut late last year. Then of course, is the other big event that happened late last year---the election of Donald Trump and his pro-energy production policies. President Trump has vowed to reduce regulations on energy companies and encourage domestic production from all sources---what he calls an "America First" energy policy.
The energy sector had already warmed to Trump before he took office, but now that he's on the job new praise is pouring in. Chevron CEO John Watson said, "I've been very pleased with the agenda that the Trump administration has," on an earnings call just days after Trump took office. Coal industry leaders also expressed hope that the Trump administration will ease some of the Obama-era burdens on the nation's coal plants.
While many of President Trump's policies have yet to actually be enacted, there are other changes that have already made a difference, like lifting the U.S. ban on exporting crude oil. "We pulled about a million barrels of production off the world stage because now we can of course export crude oil," says Tim Snyder, energy economist with Matador Economics. He tells KTRH that the slump in oil prices that began in 2014 is likely over. "Prices should be right exactly where they are treading, at $52 and some change, and we're looking for a metric that's going to change that."
Snyder believes 2017 will be a much more stable year for oil prices and the energy sector as a whole, thanks to the impact of Trump's policies at home and less production abroad. "All this production we're looking at all kind of falls into that old supply-and-demand curve," he says. "If the Saudis continue to reduce production, that will make a difference...if the United States production stabilizes, that will make a positive difference."