Clayton Seigle
Since his second term began on January 20, 2025, President Trump has clearly signaled a desire for lower oil prices. Executive orders, including “Unleashing American Energy,” as well as his remarks to the Davos World Economic Forum audience on January 23, outline Trump’s case for bringing down the price of oil.
Apart from the obvious direct advantage of reducing costs for consumers and businesses, Trump has associated the benefits of lower energy prices with two strategic priorities: first, as an instrument for taming inflation. Trump believes that a lower energy price environment will pave the way for the Federal Reserve to reduce interest rates and stimulate economic activity.
Second, Trump has asserted that lower oil prices will hasten an end to the war in Ukraine, ostensibly because Moscow would be deprived of oil export revenues sufficient to sustain its war effort. This reason, however, may have been superseded by recent events, including a February 12 phone call between Trump and Putin, a bilateral meeting of advisors in Riyadh on February 18, and Trump’s February 24 prediction that the war could end within a few weeks.
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