Oil giants accuse the US president of ‘kneecapping’ the industry with low prices

America’s oil bosses are fuming.

Donald Trump pledged to “drill, baby, drill” and “unleash American energy”.

But since his return to the White House, the opposite has happened, with US oil production now expected to fall next year.

Shale executives are grappling with low oil prices, a global supply glut and rising costs from the president’s trade war, meaning the sums no longer add up for expansion.

“The US shale business is broken,” wrote one oil boss in the Dallas Fed’s Q3 Energy Survey in September.

“What was once the world’s most dynamic energy engine has been gutted by political hostility and economic ignorance.”

The executive accused the Trump administration of “kneecapping” American oil producers.

“Drilling is going to disappear,” wrote another.

As things stand, Trump’s dreams of a new US oil boom appear crushed, as prices remain too low for any developer to invest with confidence.

According to Dan Pickering, the chief investment officer at financial services firm Pickering Energy Partners: “It’s a pipe dream [to invest] at $60 (£45.3) oil and probably at $70 oil.”

Currently, West Texas Intermediate (WTI) prices are at $60.41 per barrel, down roughly 16pc since the start of the year.

However, worse could still be to come, with Wall Street banking giant Goldman Sachs predicting that WTI prices will fall to an average of just $52 across 2026 as global supply outweighs demand.

It brings an end to what has been an extraordinary run, as US oil production has rocketed since the shale boom began in 2010.

In the last 15 years, US oil production has nearly tripled from 5.5 million barrels per day (b/d) to a record 13.6 million b/d this July.

Growth has been remarkably consistent apart from the 2014-16 oil price collapse and in 2020 at the height of the Covid pandemic. But now, it appears to have finally run out of steam.

Instead of increasing, US oil production will fall by between 500,000 and one million b/d by the end of next year, Pickering predicts.

“Normally, in any other year, shale would grow by half a million barrels per day,” says independent oil analyst Rory Johnston. “It is a big, big swing from those growth levels.”

There are clear signs that the sector is in retreat.