The domestic energy industry should thrive under a Donald Trump administration as regulations to produce oil and natural gas would be loosened, energy experts and economists predicted.
"A Trump presidency, along with a Republican majority in the Congress should be good news for the domestic energy industry," said Bernard Weinstein, a business economist at Southern Methodist University's Cox School of Business in Dallas. "After eight years of 'regulatory overreach' designed to kill the coal industry and make it more expensive to produce U.S. oil and natural gas, we can expect more accommodating policies from the incoming president who understands the links between energy and economic growth."
The energy industry should benefit under his presidency because the issues hindering both the Keystone Pipeline and the Dakota Access oil pipeline could be resolved and more supply could come onto the market, said Bruce Bullock, director of the Maguire Energy Institute in Dallas. The likelihood of the new administration increasing drilling in other areas is also high.
"Ultimately, additional drilling will depend on the price of oil," he said.
While other experts have said that additional drilling would only decrease the price of oil, Bullock said the offsetting factors will balance it out. Trump's plan to lower the corporate tax rate, spur economic growth and revitalize manufacturing "should add to GDP growth which could stabilize demand growth of both petroleum and natural gas," he said. "Additionally, a more reasonable regulatory environment could further add to GDP growth, also benefiting the energy industry."
Under a Trump administration, more drilling could occur, which would only put further downward pressure on crude oil prices, said Peter Borish, chief strategist with Quad Group, a New York-based financial firm. The decline in demand of U.S. oil products will dampen prices.