OPEC+ Warns of U.S. Oil Production Surge Under Trump’s Deregulation Plans

OPEC+ delegates have expressed concerns that the incoming administration of President-elect Donald Trump may lead to an unexpected increase in U.S. oil production. As Trump prepares to relax environmental regulations, the potential rise in U.S. oil output could undermine the production cuts and market stabilization efforts made by OPEC+.

According to sources close to the OPEC+ group, the deregulation push in the U.S. could result in more oil supply than previously forecasted. "Although the U.S. industry has signaled no major wave of supply surge, Trump’s friendly policies toward the sector could boost production to higher levels," an OPEC+ delegate explained to Reuters.

OPEC+ has been working hard to reduce its output in order to support global oil prices, but any increase in U.S. production could further erode the cartel’s market share and lead to downward pressure on oil prices.

A Shift in U.S. Energy Policies

Trump’s return to the White House is expected to bring a significant shift in U.S. energy policies, particularly with regard to oil and gas production. The Trump administration is preparing to prioritize boosting domestic drilling activities, speeding up permits for energy infrastructure, and accelerating LNG (liquefied natural gas) exports. This aggressive policy stance could rejuvenate U.S. oil output, potentially more than originally anticipated.

However, industry experts note that U.S. shale output growth has slowed in recent years, particularly since the onset of the COVID-19 pandemic. Companies are now more focused on returning capital to shareholders than aggressively growing production. Despite this shift, U.S. crude oil production is still expected to rise in 2025, building on the gains seen in 2024.

OPEC+ is closely monitoring these developments, as they could impact the global oil market balance and force changes in their production strategy. Increased U.S. production could make it more difficult for OPEC+ to maintain its production cuts. On the other hand, Trump's administration might take actions to tighten sanctions on Iran and Venezuela, potentially reducing their oil supply, which could offer OPEC+ the justification it needs to boost its own output.