Former President Donald Trump has alleged that the Organization of the Petroleum Exporting Countries (OPEC) is deliberately driving down oil prices to benefit Vice President Kamala Harris, suggesting her potential presidency could be detrimental to the United States.
Trump voiced his concerns on social media platform Truth Social, stating, “OPEC nations are going all out to drive down oil prices in the hope that crazy Kamala Harris will win. Then they will really reap the rewards! She will be a disaster for the USA!”
The accusation follows a recent decline in oil stocks amid speculation about Harris potentially adopting stricter policies towards the oil and gas industry as a Democratic presidential nominee. President Joe Biden’s decision not to run for re-election and his endorsement of Harris on July 21 have also influenced market sentiment.
Since Harris’s nomination, WTI Crude has dropped from $78.64 to $75.43, according to data from Benzinga Pro. Oil giants such as Chevron Corp (CVX), Marathon Oil (MRO), Exxon Mobil (XOM), ConocoPhillips (COP), and EOG Resources (EOG) have all experienced declines. Exchange-traded funds (ETFs) linked to the oil sector, including United States Oil Fund (USO), SPDR Select Sector Fund – Energy Select Sector (XLE), Vanguard Energy ETF (VDE), and iShares U.S. Energy ETF (IYE), have similarly faced downward pressure.
The potential impact of a Harris administration on the oil industry includes stricter regulatory requirements and higher compliance costs aimed at reducing carbon emissions and boosting investment in renewable energy. Analysts have noted that these policies could affect profitability in the sector.
Analysts from Citi have suggested that a Trump presidency might have a bearish effect on oil prices due to his pro-oil policies and potential trade actions. Conversely, under Trump, heightened tensions with Iran could disrupt global oil markets by reducing Iranian oil exports.
Goldman Sachs recently cautioned that any future U.S. administration would face challenges in significantly increasing domestic oil supply, citing low strategic petroleum reserves and regulatory constraints. Despite record U.S. oil production in 2023, concerns about oversupply persist, reminiscent of issues faced during the COVID-19 lockdowns in 2020.
Trump’s criticisms of OPEC’s influence on oil prices are not new, echoing his past statements in 2018 regarding artificially high prices set by the organization.
In summary, Trump’s accusations against OPEC and his concerns about Harris’s potential presidency highlight ongoing uncertainties in global oil markets and the intersection of energy policy with U.S. political dynamics.
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