President Donald Trump said this weekend that he may slap tariffs on a surplus of oil from Russia and Saudi Arabia to protect American jobs, the Washington Examiner reported. At a press briefing Monday, Trump demurred when asked if he would commit to cutting American production to get the price of oil back up.
America’s oil industry is in trouble as supply remains high, thanks to Russia and Saudi Arabia flooding the markets in a trade war. At the same time, demand is at an ebb with people stuck at home, flights grounded and a global economy suffering an overall contraction due to the coronavirus outbreak.
Trump floats oil tariffs to protect workers
With oil prices down about two-thirds this year, American energy workers face layoffs if oil companies fail, Reuters reported. Trump met with members of the industry Friday to discuss the crisis, and at a press briefing on the coronavirus Saturday, he didn’t rule out taking more aggressive actions, like tariffs, to protect those firms and their workers.
“We want to save a great industry. We built a great industry in this country. If they don’t get along, I would do that,” Trump said. “I would do tariffs, very substantial tariffs because we’re independent now. We have our own oil.”
Trump said again Sunday that he may impose tariffs if Russia and Saudi Arabia can’t reach an agreement, but indicated that he doesn’t think it will be needed. “If they don’t get along, I’d do tariffs … very substantial tariffs,” Trump said. “I would absolutely do that … we will save tens of thousands of jobs.”
Trump demurs on production cuts
The pricing war got underway after Russia backed out of a deal to keep supply under control in March, the Washington Examiner reported. Russia and Saudi Arabia will meet Thursday to discuss the path forward.
According to Reuters, the countries will agree to cuts, but only if the United States joins them. At a press briefing on the coronavirus Monday, Trump refused to say if America would commit to cutting back its production, explaining that market forces will likely drive producers to make cuts anyway. For now, Trump is calling on Russia and Saudi Arabia to work something out.
“Maybe we will, maybe we won’t, but we’ll have to make that decision,” Trump said, noting that OPEC had not asked America to make cuts.
Wartime president
Trump has, in the past, pressured OPEC to boost production to keep gas prices under control. But as America’s oil companies come under threat, Trump is moving in the opposite direction to protect jobs.
The oil crunch comes as at least 10 million Americans have filed for unemployment compensation in recent weeks, as the coronavirus shutters businesses large and small and leaves Americans isolated at home. Trump has declared himself a “wartime president” and taken drastic actions to counteract the pandemic, including the use of military powers to compel corporations to produce critical medical equipment, like masks and ventilators.
Trump has pointedly bashed corporations, like 3M and General Motors, that he perceives to be disloyal or lazy in their efforts to help the United States survive the coronavirus. In tweets that recalled his bashing of OPEC last year, Trump has turned to bullying American companies to crank up production. “We hit 3M hard today after seeing what they were doing with their Masks. ‘P Act’ all the way. Big surprise to many in government as to what they were doing – will have a big price to pay!” Trump tweeted last week.
At any rate, it’s evident that Trump isn’t letting niceties get in the way of protecting American jobs or lives. “I couldn’t care less about OPEC,” he said Saturday.
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