Trump pushes ‘drill baby drill’ agenda

The president has asked US oil companies to fix Venezuela's oil industry and boost its production

- REUTERS

US oil producers already reeling from low oil prices are facing renewed pressures, as President Donald Trump pushes them to boost output in Venezuela - a move that would weaken the oil market, cut revenues and hurt industry at home.

Trump has enacted policies that he says would unleash American energy and lower prices at the pump - a promise that would help US consumers but squeeze oil industry revenues. It's hard to do both - because lower profits mean oil companies drill less, not more.

Trump has asked US oil companies to fix Venezuela's oil industry and boost its production. In years gone by, access to Venezuela's vast onshore reserves - estimated to be the world’s largest - would have been a once-in-a-generation opportunity.

But with oil markets well supplied, OPEC members sitting on spare capacity - and with abundant opportunities to pump oil more cheaply elsewhere - US oil producer executives are facing the prospect of another hit to profits in the short term if more Venezuelan oil flows to the United States.