The energy sector finds itself in full swing as the Trump Administration closes in on completing the first half of the year. The oil and gas industry in particular is bustling with activity inspired by a bright future derived from President Trump’s campaign promises, but fear looms on just how long that uptick in activity will last. No matter what else President Trump might be doing, his tariff wars have been at the center of attention, and many in the fossil fuel extraction and production industry fear a hard stop in that new activity might be too close for comfort.
The need for the President’s tariffs lies at the root of a bitter difference of opinion. No matter which side one might support, tariffs pose an interesting dilemma. While they might not directly impact a certain product or industry, the trickle down effect wages consequences from indirect sources. For instance, tariffs could weaken demand and pricing. With the potential for a decreased global GDP due to tariffs, oil demand could fall.
The industry certainly finds itself in a better situation than five years ago. Hard decisions and a new method to spending has fortified many companies to withstand instances of hardship, but those contingencies can only last so long. Like a company in any industry saving for a rainy day and keeping its employees on the payroll while “praying for rain,” oil and gas companies can do the same, but not indefinitely. At some point, those hard decisions come back into play.
President Trump has his strategy and there is a certain resonance in unifying behind the “everyone has to pull their weight” mantra. Indeed, the United States has long been taken advantage of on many fronts, and the taxpayers deserve relief. When we live in a world where eggs and milk have become items that might be removed from the basket to save money at the grocery store, clearly some things must change. If tariffs are a way to dispense relief in a trickle down mechanism to the taxpayers, then it seems they are necessary.
The secret to their success might be in the balance of how they are utilized and for how long. Could they simply be a bargaining chip, or could tariffs find a near permanent place in governing? Time will tell and for how long will determine the impact made on the oil and gas industry.
Nick Vaccaro is a freelance writer and photographer. In addition to providing technical writing services, he is an HSE consultant in the oil and gas industry with twelve years of experience. Vaccaro also contributes to SHALE Oil and Gas Business Magazine, American Oil and Gas Investor, Oil and Gas Investor, Energies Magazine and Louisiana Sportsman Magazine. He has a BA in photojournalism from Loyola University and resides in the New Orleans area. Vaccaro can be reached at 985-966-0957 or nav@vaccarogroupllc.com.
- Nick Vaccarohttps://energiesmedia.com/author/nick-vaccaro/
- Nick Vaccarohttps://energiesmedia.com/author/nick-vaccaro/
- Nick Vaccarohttps://energiesmedia.com/author/nick-vaccaro/
- Nick Vaccarohttps://energiesmedia.com/author/nick-vaccaro/
- Nick Vaccarohttps://energiesmedia.com/author/nick-vaccaro/
- Nick Vaccarohttps://energiesmedia.com/author/nick-vaccaro/
