Trump's Short-Sighted Energy Policies

Almost as soon as cult leader, convicted felon, and failed President Donald Trump took office for his second term as President, he began promising that gasoline would soon be below $2 a gallon. In December, the White House issued a press release bragging that "The nationwide average for regular gas is at its lowest level in 1,681 days". Trump has made repeated claims that gas "hit $1.98 a gallon" in multiple states. In fact, no state has had an average gas price below $2. But now, thanks to Trump's war against Iran, gas prices are double the $2 a gallon that Trump has predicted. According to GasBuddy, the nationwide average today is roughly $4 per gallon. Trump has wedded himself to the fossil fuel industry and made a number of short-sighted, if not downright stupid, decisions regarding the U.S. energy sector. Now, many of those chickens are coming home to roost.

In April 2024, while campaigning for the presidency, Trump hosted oil industry executives at Mar-a-Lago. Trump asked them to pledge $1 billion to his campaign. In exchange, Trump promised that, if elected, he would do their bidding. After his victory, Trump held true to his promise. He immediately started targeting the green energy and electric vehicle sectors. Trump's administration stalled or cancelled permits for wind and solar projects. Trump cut subsidies for EVs that had been successful in popularizing the vehicles. He attempted to cut the federal funding for EV chargers. The administration halted tax credits for solar panel installations. Trump also went after incentives that had led to several new factories for green energy-related products such as batteries and solar panels. Now, in light of current gas prices, these decisions are not looking particularly wise.

Making Trump's anti-green energy position even worse is that it reversed tremendous gains made under former President Joe Biden. New green energy projects take time to build, so many efforts launched under Biden have just come to fruition. The U.S. Energy Information Administration just announced that renewable energy provided a quarter of U.S. electrical generation in January 2026. That is an 11% gain over last year. In 2026, solar, wind, and batteries added 55 gigawatts of new capacity. In contrast, fossil fuels added less than 1 gigawatt. We were on a path to widespread affordable green energy, and Trump has done everything he could to stop it.

Trump's actions probably pleased his benefactors in the oil industry, but they left Americans vulnerable to volatile oil and gas prices. With gas at $4 or more, it would be nice to have a lot more solar panels on roofs and EVs in driveways. Trump and his administration, however, have simply volunteered Americans to sacrifice for the sake of the war. Today during one of Trump's bootlicking cabinet sessions, Treasury Secretary Scott Bessent praised Trump's economic leadership and then argued that "Many people, especially the Democrats, underestimate the will of the American people for short-term volatility". So, hear that? Paying an exorbitant amount to fill your gas tank is your patriotic duty.

Moreover, while Trump and his lackeys keep stressing that these are short-term price increases, the reality of the oil market is that, even if the war ends shortly, the higher prices will probably be with us through the summer. If the war goes longer than Trump expects, all bets are off. Despite Bessent's optimism, Bloomberg reported yesterday that "Trump administration officials are examining what a potential spike in oil prices as high as $200 a barrel would mean for the economy". Those who depend on gasoline are going to be in a difficult position.

I am not sure that most Americans understand just how serious oil problems are elsewhere in the world. The U.S. produces a lot of oil and, in fact, is a net exporter. As such, we are unlikely to encounter shortages. But, as other nations get desperate and offer to pay more for oil, the U.S. will be subject to the same global price increases. Already the Philippines has declared a national energy emergency and instituted a four-day work week. South Korea is telling its citizens to take shorter showers. Vietnam only has 20 days of reserves. In India, restaurants are shutting down because they can't get cooking gas. Even New Zealand is facing trouble with only 40 days’ worth of fuel left. The country is considering instituting gas rationing. Many of these countries and others will likely engage in panic buying, which will drive oil prices even higher. This will be reflected at American gas pumps.

In the U.S., it is not just American drivers that Trump has harmed. Due to Trump's anti-EV posture, American auto manufacturers downgraded their EV plans. These companies were already being taken to the cleaners in the EV market by foreign manufacturers, especially those in China. Outside the U.S., EVs have been on an upswing. The current oil price shock will only further encourage the switch to EVs. Meanwhile, U.S. companies will be stuck with internal combustion models that will be practically unwanted outside the United States. Trump has done untold damage to the future of the American auto industry.

In February 2021, the U.S. Postal Service announced that it would be adding 165,000 electric vehicles to its fleet. Almost two years later, USPS announced that by 2026, 100% of its vehicle purchases would be electric. When the first electric delivery trucks were delivered, the drivers loved them. Trump initially threatened to scrap the EV contract altogether, and a version of the One Big Beautiful Bill had a requirement for the USPS to sell its EVs. However, that provision was ruled out by the Senate Parliamentarian. Ultimately, the contract was altered to drop the EV percentage to 70% rather than 100%. Yesterday, the Postal Service announced an 8% surcharge on certain postage prices due to increased fuel charges caused by the Iran war. Imagine how much worse this would be had Trump been able to get rid of all the Postal Service's EVs?

Trump has special animosity towards windfarms. This has its origin in a controversy involving Trump's golf course in Scotland. Soon after he purchased the property, an offshore windfarm project was announced. Trump fought a several-years-long effort to stop the project, which he was concerned would ruin the views from his golf course. Trump ultimately lost the battle but has hated windfarms ever since. As President, he has tried to stop several offshore windfarm projects in various phases of completion. His efforts were eventually defeated in court, but it has resulted in long delays.

More recently, Trump agreed to pay a French company, TotalEnergies, $1 billion to drop plans for two offshore windfarms. When the agreement was announced, U.S. officials stressed that TotalEnergies would instead invest in natural gas facilities in Texas. However, it turns out that TotalEnergies was already investing in such projects. Therefore, there is no certainty that the $1 billion deal will result in any additional investment. Instead, TotalEnergies can use the money to pay for its current investments. Essentially, Trump just spent $1 billion, in the middle of an energy crisis, to prevent residents of North Carolina and New York from getting cheap, zero-carbon electricity.

Trump has claimed to be a very stable genius. However, his alleged genius has not been on display recently. He did all that he could to stop green energy projects and prevent the spread of EVs. Then he started a war that predictably spiked oil prices. Trump expects Americans to suck up the cost increases they see at the gas pump as a show of support for the war. However, most Americans don't support the war. Moreover, despite Trump's repeated claims, there is no end in sight for the war, and the oil price increases will extend for months after the fighting stops. Trump's genius has led us into disaster.