"Opportunity from the 2020 Russia-Saudi Production Cut Agreement"
As the U.S. presidential race enters its final stages, the oil industry is emerging as a major source of funding for former President Donald Trump, Bloomberg reported on the 6th (local time).
According to the report, during the 2024 U.S. presidential election cycle, the oil industry has contributed approximately $14 million to Trump's campaign and related Super PACs (Special Political Action Committees), ranking fourth among all industries. The top contributor is the financial and investment sector, which has donated $116 million.
Bloomberg noted, "The oil industry has risen six ranks compared to the 2020 election, now becoming Trump's fourth largest cash source," adding, "As the influence of Democrats supporting the oil industry in both the House and Senate has weakened, the long-standing alliance between energy industry leaders and the Republican Party has strengthened."
Tyson Slocum, head of the energy program at the U.S. consumer protection group Public Citizen, described the oil giants as a "bottomless money well" for former President Trump, stating, "Oil companies have a lot of money, and their lobbying and influence pipelines toward Washington D.C. have become very mature."
Trump's courting of the oil industry is ongoing. In an interview with Fox News last August, he repeatedly used the slogan "Drill, baby, drill," declaring his intention to make the U.S. an energy-dominant country on the global stage. He also promised to immediately lift President Joe Biden's ban on natural gas exports upon taking office.
However, Bloomberg pointed out that the decisive factor for the oil industry's support of Trump was different. In March 2020, the oil giants suffered a critical blow due to a price war between Russia and Saudi Arabia, and it was Trump who managed to resolve the crisis. Due to the conflict between the two countries, on March 8 alone, the price of West Texas Intermediate (WTI) crude oil plummeted 34%, and Brent crude prices fell 24%. Jeffrey Hildebrand, founder of energy company Hilcorp, reportedly lost 90% of his net worth at that time.
Bloomberg explained, "Trump secured an agreement from OPEC+?the group of OPEC and non-member oil-producing countries including Russia?to cut production by at least 10 million barrels per day," adding, "Following this, fuel demand and prices steadily rose until the summer of 2020, creating a political burden for Biden."
Despite having the oil industry as a strong backing, there are concerns that Trump is not yet in a secure position. The Trump campaign exceeded its fundraising by $32 million in August, resulting in a deficit, and last month spent $72 million on media advertising, which is less than half of the $192 million spent by the Harris campaign. In particular, the oil industry has expressed opposition to Trump's pledge to fully repeal the Inflation Reduction Act (IRA), signaling potential friction. The IRA is a flagship pro-environment manufacturing revival policy of the Biden administration, which Trump has consistently criticized as a "green new scam" disguised as environmentalism.
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