Oil Prices Surge to $75 as Trump’s 2024 Victory Stirs Market Uncertainty
By Okafor Joseph Afam
November 7, 2024
Oil prices climbed to $75 per barrel following Donald Trump’s win in the 2024 U.S. presidential election, adding fresh uncertainty to global markets.
Brent crude futures rose 65 cents, or 0.87 percent, to $75.57 per barrel early Wednesday. U.S. West Texas Intermediate (WTI) crude similarly increased, gaining 54 cents, or 0.75 percent, to reach $72.23. Anticipation of a pro-oil, deregulatory agenda from Trump’s administration has U.S. oil producers hopeful for more relaxed restrictions on crude production. This, in theory, could raise supply and press prices downward.
However, the outlook remains uncertain. Trump has vowed to impose further sanctions on Iranian and Venezuelan oil, moves that could tighten global supply and potentially drive prices up. “Conceptually, the impact of a second Trump term on oil prices is ambiguous,” noted Goldman Sachs analysts in a research note, pointing to both potential risks to supply and demand in the global market.
Trump’s victory speech highlighted his enthusiasm for boosting U.S. oil production. Speaking from Republican campaign headquarters, he mentioned independent candidate Robert F. Kennedy Jr. as a future team member, humorously advising, “Bobby, stay away from the oil, stay away from the liquid gold!”
The Biden administration had overseen record U.S. oil production, even while advocating for a green energy transition. Presently, U.S. crude futures are trading between $70 and $75 per barrel, a range insufficient for many producers to balance costs. Any move by Trump to ease federal leases could flood the market with supply, pushing prices lower, said Cole Smead, CEO of Smead Capital. “Drill, baby, drill is going to run into the energy vigilantes,” he added, referencing the restraint investors now expect from the energy sector.
Amrita Sen, founder of Energy Aspects, pointed to Trump’s history of supporting low oil prices, yet argued that sanctions could actually boost prices by removing sanctioned barrels from the market. “You could lose a million barrels per day from Iran,” she noted, as well as additional Venezuelan barrels.
For now, Trump’s energy policies remain a wildcard. With the U.S. as both the largest oil producer and consumer, the path his administration chooses will likely play a pivotal role in global oil dynamics, impacting producers and consumers alike.
