According to a third-quarter regional survey released by the Dallas Federal Reserve Bank last week, pessimism among U.S. oil and gas industry executives regarding the traditional energy sector's outlook is rising. Many executives are increasingly frustrated with the obstacles created by the chaotic trade policies of the Trump administration after his return to the White House, as well as frequent changes in regulatory guidelines.
For the North American oil and gas industry that fully supports "Trump's MAGA movement," Trump's presidency has not made "American oil industry great again" as he promised. While U.S. oil production has indeed reached new highs when measured by "output," the industry has not shown the robust expansion that Trump promised when measured by "prosperity/profitability/investment willingness," and executive sentiment remains cold.
MAGA, short for "Make America Great Again," can refer to both the core tone of all policies of the Trump-led U.S. government and is used by some mainstream media to refer to Trump himself and American voters who fervently support Trump. "Make American oil industry great again" essentially equates to "high production + high prosperity + strong investment." Currently, it's more like "high production, low temperature" - impressive output, but U.S. oil price levels and policy/tariff/uncertainty pressures are weighing on capital expenditure and prosperity. Overall, the entire U.S. oil industry appears more like "producing while suffering internal damage" rather than being "great again."
The Trump administration's leadership in imposing high global steel and aluminum tariffs (tariffs as high as 50% on steel and aluminum) has pushed up costs for OCTG (oil country tubular goods), pipelines, fracking equipment, and construction. This is repeatedly identified by oil and gas industry executives in the survey report as a source of "cost escalation + policy volatility."
On one hand, the U.S. traditional energy industry complains about tariffs raising costs on steel and other materials, with policy reversals bringing "chaos." On the other hand, OPEC+ has turned to production increases under U.S. pressure to lower oil prices, suppressing price elasticity - which is very unfavorable for the profitability of the U.S. oil industry centered on shale oil.
Overall, changes in U.S. private business regulatory policies under the Trump administration, concentrated, rapid, and direction-changing policy/rule adjustments around key areas such as methane, RFS, offshore and public land development, and LNG (liquefied natural gas) approvals, as well as "start-from-scratch" adjustments to carbon emission standards, NEPA procedures, and offshore financial guarantees, have made compliance and capital planning difficult to implement stably. These factors have collectively driven collective complaints about "rising uncertainty and declining investment willingness" among executives in one of Trump's core constituencies - the U.S. oil and gas industry - in the Dallas Fed survey.
**U.S. Shale Oil Business Collapse**
The Dallas Fed survey was conducted from September 10-18, measuring the latest sentiment of 139 oil and gas industry executives covering the most core U.S. oil and gas regions - Texas, northern Louisiana, and southern New Mexico. The overall energy production (primarily oil) from these regions even exceeds some of the world's largest oil-producing countries.
"The U.S. shale business has shown signs of collapse," said one surveyed executive. "What was once the world's most dynamic energy engine has now been hollowed out by the Trump administration's political hostility and economic ignorance."
"We have entered the 'shale twilight period' of this shale oil segment," said another oil and gas executive. "America hasn't run out of oil, but she (the Statue of Liberty) is indeed running low on oil priced as high as $60 per barrel."
"Once America needs to boost production, a vibrant oilfield services sector is crucial. Now we're bleeding," said an executive from a publicly traded oil and gas support services company.
Criticism of Trump's policies is not new, but Wall Street analysts generally say the latest content represents a significant escalation in tone regarding the entire U.S. oil and gas industry and warnings about the future, as executives describe the U.S. president's steel tariffs and sudden shifts and frequent adjustments in energy policy as "kneecapping" an industry he once promised to help.
The survey also found that U.S. oil and gas industry executives believe West Texas Intermediate (WTI) crude oil prices will be much lower than previously expected, forecasting 2025 to close at about $63/barrel and remain in the $60 range through 2027. In the second quarter, these executives had predicted WTI crude oil prices would close at about $68/barrel by year-end and return to the optimistic $70 range within two years.
Last week, crude oil futures prices rose significantly due to Ukraine's continued attacks on Russian oil infrastructure, undoubtedly bringing rising geopolitical risk premiums for countries like India and China that have long purchased Russian oil, as well as the possibility of more EU and U.S. sanctions.
The impact of drone attacks is accumulating. Deputy Prime Minister Alexander Novak said Thursday that Russia would impose partial bans on diesel exports until the end of the year and extend existing gasoline export bans. This Russian move represents significant oil and gas import and export obstacles for the two major economies of India and China.
U.S. President Trump is also continuously and carefully pressuring American allies to reduce any oil imports from Russia to push Russian President Putin to the negotiating table. Andrew Lipow, president of Lipow Oil Associates, said, "We might see India and Turkey reduce some Russian imports."
NATO's warning response to further airspace violations has also heightened tensions and increased the possibility of more sanctions on Russia's oil industry.
Additionally, according to the national news agency, crude oil exports from Iraq's semi-autonomous Kurdistan region are planned to resume last Saturday, a move that could keep oversupply expectations fermenting and continue driving Brent crude oil prices into a significant downward trajectory.
Media reports citing informed sources revealed that Iraq is negotiating with one of the most influential giants in crude oil transportation - commodity trading giant Vitol - to handle crude oil sales once the country's Kurdish region's crude oil exports resume after a two-year halt.
For the long-term weak international crude oil benchmark - Brent crude oil price trends this year, this news is obviously negative. The resumption of Kurdish oil exports will fuel expectations of "crude oil market oversupply," potentially driving the recently rebounding Brent crude oil prices into a weak trajectory.
As of last week's close, the near-month November-delivery WTI crude oil price on the New York Mercantile Exchange (Nymex) closed up +5.3% at $65.72/barrel, while the November near-month Brent contract on the Intercontinental Exchange closed up +5.2% at $70.13/barrel - the largest weekly gains for both benchmark crude oil prices since the week of June 13. The October near-month natural gas on Nymex closed up +0.5% at $3.206/MMBtu.
On Friday, Nymex crude oil, Brent crude oil, and U.S. natural gas futures prices rose 1.1%, 1%, and 0.3%, respectively.
The energy stock benchmark ETF (represented by the Energy Select Sector SPDR Fund, ticker XLE) closed up +3.9% last week, significantly underperforming the S&P 500 index year-to-date.
**Goldman Sachs Turns "Crude Oil Super Bear": Global Oil Oversupply Set to Intensify, Brent Crude May Fall Below $50/Barrel by 2026**
According to the International Energy Agency, under expectations of OPEC production increases and North American shale oil producers scaling up production under Trump administration promotion, the global crude oil market is on the verge of showing significant oversupply in supply and demand, and the return of Kurdish crude oil will only further exacerbate this oversupply situation.
Previous media reports indicated that pipeline restoration is initially expected to bring about 230,000 barrels of crude oil per day to international markets, and this quantity may increase further. If the Kurdish pipeline continues to operate as planned, it would be marginally bearish for Brent crude oil prices. Kurdish resumption is initially expected to bring ~230,000 barrels/day to market, potentially rising to as much as 1 million barrels/day later.
The IEA judges that the supply side in 2025 already leans toward oversupply, and supply excess may further expand in 2026. The return of Kurdish oil will undoubtedly exacerbate this market background of supply oversupply.
Goldman Sachs maintains its unchanged forecasts for 2025 Brent crude oil/WTI crude oil prices in its latest commodities research report and expects 2026 average prices of $56/$52 per barrel. However, the Wall Street financial giant notes that due to negative impacts from intensifying global crude oil market oversupply, Brent crude oil futures prices have a probability of falling below the $50 per barrel threshold by the end of 2026.
The U.S. financial institution states that from the fourth quarter of 2025 to the fourth quarter of 2026, the global crude oil market will average 1.8 million barrels per day of excess supply, a scale that will cause global oil inventories to increase dramatically by nearly 800 million barrels during this period.
The report particularly emphasizes that inventory increases in Organization for Economic Cooperation and Development (OECD) member countries will account for one-third of the global total increase, reaching about 270 million barrels.
Goldman Sachs adds that as oversupply and inventory pressure jointly intensify significantly in 2026, Brent crude oil prices will fall below current futures market expectations.
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