Energy Secretary Tries to Reassure US Oil Bosses Amid Trade War

Harold Hamm at the CERAWeek by S&P Global conference in Houston in March. Photo by Aaron M. Sprecher /Photographer: Aaron M. Sprecher/

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(Bloomberg) — Energy Secretary Chris Wright sought to reassure US oil companies during a visit to Oklahoma, saying turmoil from President Donald Trump’s trade war is apt to be fleeting and the administration fully supports more crude output.

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“The uncertainty you are seeing around tariffs — that’s a short term issue,” Wright said during an interview with Bloomberg Television at an energy conference in Oklahoma City. He later added: “We’re doing everything we can to encourage production.”

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Wright, who previously ran one of the world’s biggest fracking-service providers, said the uncertainty roiling the broader market is because the US in the midst of negotiating more favorable trade deals. He predicted it would only last “a few more weeks.” 

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When it comes to oil production, Wright said the Trump administration is focused on tearing down barriers to make it cheaper and easier to pump crude and natural gas.

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Wright and Interior Secretary Doug Burgum appeared at the event hosted by shale billionaire Harold Hamm as oil prices have plunged more than 10% this month in the wake of Trump’s trade war and a decision by OPEC to beef up a production increase scheduled for later this year. For 14 consecutive days, West Texas Intermediate futures have settled below $65 a barrel — the price many companies need to break even on new wells. 

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Those lower prices coupled with the trade war have caused significant unease across the industry, threatening to undercut the president’s own goal to ramp up fossil-fuel production.

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Two of the largest oilfield service providers, Halliburton Co. and Baker Hughes Co., warned this week that tariffs were impacting their bottom line. Matador Resources Co., a Texas shale company, announced Wednesday it was dropping one of its nine drilling rigs. And last month, a host of oil bosses delivered scathing critiques of Trump’s policies in an anonymous survey by the Federal Reserve Bank of Dallas.

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Nonetheless, the executives at Thursday’s event in Oklahoma City, focused on powering AI development, were largely upbeat. 

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“We feel good about where we’re at,” Clay Gaspar, chief executive officer of Devon Energy Corp. said in a Bloomberg TV interview. 

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He added that oil prices, which settled Thursday near $63 a barrel, have remained close to the $65 average that Devon uses to plan its operations in the midst of a cycle.

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Hamm, the co-founder of Continental Resources and one of Trump’s biggest donors from the oil patch, said the president needs leeway to hammer out trade deals.

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“I see a lot of positives — we just don’t want to get bogged down negatively,” Hamm said in a Bloomberg TV interview. “We’ve seen so many good things, I think he’ll go down as the president that made a difference.”

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Hamm added that removing the uncertainty from tariffs could help oil prices climb back into the mid-$70s.

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Burgum, the interior secretary, told executives at the event that he will slash permitting times to 14 days for projects solely under the purview of his department. For projects needing a full environmental impact statement, his goal is 28 days.