Jason Bordoff and David R. Hill
U.S. President-elect Donald Trump’s nomination of Liberty Energy CEO Chris Wright as energy secretary has been both widely celebrated and condemned because of the latter’s views on oil, gas, and climate change. The Wall Street Journal summed up the appointment with the headline: “Trump’s Choice for Energy Secretary Is a Fracking Booster and Climate Skeptic.” The coverage is consistent with post-election commentary on the energy implications of Trump’s return to power that has focused almost exclusively on his push to deregulate oil and gas production and his promise to withdraw from the Paris climate agreement for a second time. Yet if Trump wants to keep his promise to cut energy costs, bolster the U.S. economy, and respond to voter anxiety about inflation, his administration should focus less on oil and gas and more on something less polarizing: modernizing and expanding the country’s aging electric power system.
The current oil outlook suggests little reason for concern about pump prices, with sluggish Chinese economic growth, rising electric vehicle sales, and the return of more OPEC barrels to the market. As for the trajectory of U.S. oil and gas supply, markets will matter far more than policy. Indeed, for all the political rhetoric, it is hard to tell which party was in control when looking back over the past two decades of steady U.S. oil and gas production growth.
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