With the comfortable victory over his rival, Kamala Harris, President Trump will certainly pursue his radical energy policies in order to deal with the crises in the energy sector, while sticking to his, 'Drill baby drill' policy.
In anticipation of a supply boost in the near future, the oil markets reacted to his reelection that defied both pundits and pollsters; the price of crude oil went down by a moderate margin.
As of 12:05 GMT on Thursday, the prices of WTI and Brent were at $70.45 and $74.84 respectively. The price of LNG, liquified natural gas, was at $2.75.
In his last few rallies, President Trump picked on the high energy prices as the main factor behind the rampant inflation that became a major political issue during the campaign; the campaign of Ms Harris was caught unprepared at the centre of the inflation storm amidst the accusations of not tackling it in a meaningful way, when she had the time to make a difference.
President Trump, by contrast, met ordinary Americans and listened to the grievances that mainly stemmed from the high inflation. In response, he promised to cut energy bills by half, if elected. Judging by the way people voted, the promise seems to have resonated very well with a vast number of Americans.
The US is already the biggest producer of crude oil, thanks to the revolutionary fracking that brings up oil, trapped deep down between rocks. President Trump never shied away from his determination to produce more oil, if elected, often referring to source, the 'Black Gold' right under the American feet.
Politically, President Trump is in a strong position to pursue his energy policies: not only did he win a comfortable majority across the vast country, but also managed to win the majority of the Congress - already in the Senate and predicted in the House of Representatives - too.
President Trump's policies traditionally in favor of increased production of oil and natural gas through deregulation, expediting permits for drilling, especially on federal lands, and potentially refilling the Strategic Petroleum Reserve; one of the first steps taken by President Biden, as far as the energy sector was concerned, when first elected, was suspending the licences for drilling on the federal lands; although he relaxed it somewhat lately, when he failed to persuade the OPEC+ to increase the productions.
Increased drilling activities certainly will lead to a short-term increase in oil and gas supply, potentially lowering prices further, as the unrest in the Middle East does not pose a threat to the oil markets in a significant way, as the markets have enough oil for distributions.
President Trump, meanwhile, sounded conciliatory recently, when it comes to Iran, the country with the third largest proven oil reserves: at present, Iran is allowed to sell a limited amount of oil just to buy the essentials for its populace; it, however, goes without saying that Iran produces - and sells - much more than it was supposed to do, while bragging about its well-hidden veins that criss cross the oil markets; one of the main buyers has been the world's top oil importer - China.
It is not clear whether President Trump would force China to buy less oil from Iran or stop it altogether; China would not risk being penalised, if the issue evolves into that stage. The leader of the Free World will certainly spell out his Iran policy in the coming weeks, perhaps taking into account the evolving conflict between Iran, its proxies and Israel. President Trump said this week that he does not want to see Iran being ruined; on the contrary, he says that he wants to see Iran prospering, without acquiring nuclear weapons. His reelection, however, led to the fall of Iranian rial significantly.
With the reelection of President Trump, the value of dollar sured in the international markets. Strong dollar, however, could make oil more expensive to buy for the non-oil producing nations, even if there is plenty of supply at present.
