**Trump’s Oil Dreams Face Economic and Market Realities**

President-elect Donald Trump’s ambition to lower gasoline prices to under $2 per gallon may encounter significant roadblocks. Despite his rallying cries to "Frack, frack, frack and drill, baby, drill," achieving such a goal is complicated by various economic and geopolitical factors.

In a move that reflects his pro-fracking stance, Trump chose Chris Wright, the CEO of Liberty Energy, as the new secretary of energy. Wright is a staunch advocate of fracking, vocally supporting the extraction of oil and natural gas. However, the American oil industry is already at a historic high in production, making it uncertain whether further increases in output will lead to lower gas prices.

According to the US Energy Information Administration (EIA), the United States is producing over 13.4 million barrels of oil daily, with projections of reaching 13.6 million barrels by the end of 2025. This record-breaking output surpasses any other country’s production and has resulted in significant oil exports.

A recent report from the Eurasia Group suggests that US crude production may exceed 14 million barrels per day by 2025. Such an increase could potentially lower the price of West Texas Intermediate (WTI) oil to below $60 per barrel. The price for WTI has already dropped from $72.26 before the election to $67.03 in recent trading.

However, economics and global oil markets present a challenge. OPEC could respond to declining oil prices by reducing its production to sustain higher prices or by increasing its output to force some US producers out of business, similar to the price war of 2015-2016 that led many American oil companies to bankruptcy. Additionally, if the price of oil dips between $55 and $65 per barrel, it would fall below the break-even point for new shale production, creating further economic stress.

Trump has boasted about gas prices falling below $2 a gallon during his previous administration, attributing it to increased production, while disregarding the impact of the pandemic, which sharply reduced demand as people stayed home. Further increased production could again lead to reduced prices, but at the risk of causing economic disruptions and production cutbacks.

Despite record profits in 2022 due to high oil prices following Russia's invasion of Ukraine, major oil companies have opted to use their earnings for stock buybacks and acquisitions rather than ramping up exploration and production significantly. Andy Lipow, president of Lipow Oil Associates, pointed out the difficulty in producing well beyond 14 million barrels a day as the most cost-effective drilling locations are already in use.

Moreover, global factors such as China's slowing economy and the shift towards clean energy are reducing overall oil demand. The International Energy Agency reported a decline in oil demand in China for the sixth consecutive month in September. This illustrates the point that US oil output is more responsive to market efficiencies and global economic conditions rather than presidential policies.

Former energy official Bob McNally highlighted that no president, including Trump, has direct control over oil production levels, underscoring the complexities behind the energy market that extend beyond mere policy changes.