Trump wants “America First” policy on energy

OREANDA-NEWS. May 27, 2016. US Republican presumptive presidential nominee Donald Trump in his first foray into energy policy promises to make achieving energy dominance in global markets a top US foreign policy priority.

"We will become energy independent" and cut oil imports from Opec and "hostile nations," Trump said today during a self-described major energy speech at a North Dakota oil and gas conference. The "America First" energy plan will rely on US oil, natural gas and coal reserves, which Trump says are the largest in the world.

The US Energy Information Administration projects that the US could become a net exporter of energy by 2030. But Trump says his policy will help achieve energy independence during his term by abolishing "massive, bureaucratic" regulations President Barack Obama imposed on the fossil fuel industry.

"Imagine a world where our foes and oil cartels cannot use oil as a weapon" against the US, Trump says.

Trump's policy pronouncements show him in the mainstream of the Republican party in viewing environmental regulations on the energy industry too onerous and the Environmental Protection Agency as intent on squeezing out fossil fuel production. "The federal government is in the way. We have so much potential energy, you would not believe it," he said.

Trump also said he will pull the US out of the Paris climate accords, so that "foreign bureaucrats do not control what we do in our country."

Trump put an unusually commercial spin into his energy policy pronouncements, promising to reverse Obama's decision on the 830,000 b/d Keystone XL pipeline, but only if Canadian midstream company TransCanada would give the US a significant portion of the pipeline's profits — which would be an unprecedented arrangement.

"I want a piece of the profits for the US," he said.

TransCanada was not immediately available for comment.

But Trump is especially keen to highlight the plight of the US coal industry and says he plans to press his pro-coal credentials in states like Pennsylvania against the likely Democratic nominee Hillary Clinton.

Clinton "is worse than Obama. She is openly saying we will put coal mines out of business, shut down steel mills," Trump says. As a result, Trump expects to "carry Pennsylvania easily."

The EIA estimates that US coal output will fall by 17pc this year, following an 11pc decline in 2015. Gas is expected to overtake coal in the US generation stack in both 2016 and 2017.

Clinton has promised to allocate \\$30bn to coal communities hit hard by unemployment, including for training, economic development and meeting pension and medical obligations by bankrupt producers. Clinton at a debate in March said "we are going to put a lot of coal miners and coal companies out of business" as a result of the transition away from fossil fuels, a phrase that has come to haunt her in the primaries held in coal-mining states.

Trump admits low natural gas prices are in part responsible for shrinking coal output. But the government is the main culprit and he promises to "free up coal" from regulation, which he says will ultimately make it very inexpensive. Natural gas prices in the midcontinent dropped by 26pc in the past year, below \\$2/mmBtu, at or below delivered Powder River Basin coal prices, which shed only 3pc, Argus data show.

If Clinton is elected president, "things may get much worse, believe me," Trump said. "She will shut down energy production across this country." Trump claims the US has \\$50 trillion of untapped oil and gas reserves on federal land, an estimate that exceeds official estimates by at least an order of magnitude.

Clinton has backed the current administration's policy of eventually phasing out fossil fuel production on public lands, but says she backs "responsible" oil and natural gas production and exports.

Trump's digs at Opec during his speech appear to reflect the view of his unofficial energy advisor representative Kevin Cramer (R-North Dakota). Cramer is co-sponsoring a bill to investigate whether Opec's role in oil markets is "anti-competitive."

Trump, a real estate developer who has never held elected office, has a long history of easily reversing course and backing away from proposals.

Trump's pronouncements already are rattling foreign leaders who count on the US "to provide a certain level of stability and direction when meeting global challenges," US president Barack Obama said today on the sidelines of the G7 summit in Japan.

Trump's proposals "display either an ignorance of world affairs, or a cavalier attitude, or an interest in getting tweets and headlines instead of thinking through," Obama said.

Trump countered by saying "it is a good thing they are rattled. Many countries have been abusing us, taking advantage of us. When you rattle someone, it is good."