Trump Promises to Export More Oil, but Impact on Brazilian Exports Could Be Limited, Says Expert

While the world strategizes and seeks ways to promote renewable energy sources, the new U.S. President, Donald Trump, reaffirmed plans to boost American oil reserves during his inauguration speech on Monday (20). Despite declining prices, the outlook for the coming months will depend on other decisions by the American president, according to an expert consulted by Valor.

Trump stuck to the script he had promoted throughout his campaign and repeated the catchphrase: “Drill, baby, drill.”

The newly inaugurated president announced that he would declare a national energy emergency to lower consumer costs and increase production.

“The inflation crisis was caused by excessive spending and the surge in energy prices. That’s why I am declaring a national energy emergency today. We are going to drill, baby, drill,” Trump said in his inaugural address.

The president added: “The United States will become an industrial nation once again, and we’ll have something no other industrial country has: the largest amount of oil and gas possible, and we will use it. We’ll lower prices, refill our strategic reserves, and export American energy to the world. With that liquid gold beneath our feet, we will become a wealthy nation again.”

WTI crude oil prices, the most widely used benchmark in the U.S., opened the day lower and remained volatile during the speech. The commodity began the day at around $76.59 per barrel, fluctuating between $76.30 and $76.96 throughout the afternoon.

Brent crude oil, traded in London, also declined on Monday, priced at $79.95 per barrel—a 0.25% drop.

Prices in the Coming Months

The U.S. oil industry is expected to expand under Trump’s administration, according to Décio Oddone, CEO of Brava Energia. However, it is still too early to predict the effects on global oil prices:

“In the medium term, the impact on global prices will depend on how sanctions are managed, particularly against Iran, Russia, and the relationship with Venezuela,” Oddone explained.

Oddone, who served as Director-General of Brazil’s National Agency of Petroleum (ANP) from 2016 to 2020, stated that the boost to the oil industry could benefit Brazil but warned that renewable energy projects worldwide—especially in countries influenced by the U.S.—might face setbacks.

“For now, the impact on Brazil is limited. I don’t foresee competition between Brazilian and American oil, as they are different types. Brazil remains strong in Asia,” Oddone concluded.

By Kariny Leal

Source: Valor Econômico

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