Trump's energy dominance turned into hubris, Reuters columnist says

what happened

Reuters columnist Ron Bousso argues that Donald Trump's push for energy dominance, once the foundation of his economic and foreign policy, has become a liability. Soaring household fuel costs have made energy policy a major political problem for the president ahead of the November 3 midterm elections.

The United States became the world's largest natural gas producer in 2009 and oil producer in 2018, and the top LNG exporter by 2022. Yet producing energy does not mean controlling prices. After the war with Iran led to the effective closure of the Strait of Hormuz, Brent peaked at $118 a barrel in March and is trading around $110. US gasoline rose above $4.60 a gallon in May, and diesel hit a record $6.50 in September.

The administration tried to contain prices by easing biofuel blending mandates and reaching a diesel supply deal with Vladimir Putin, but US fuel is sold at global prices, so domestic costs remain tied to the world market.

why it matters

For markets, the main takeaway is that large output does not guarantee low prices. Bousso says the Iran war risk premium is becoming entrenched, and energy security is becoming more costly for import-dependent Asian economies.

market impact

Oil and fuels: a lasting geopolitical risk premium supports Brent and US gasoline and diesel prices.

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