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Donald Trump is firmly back in the US presidency, with the likelihood of Senate and House or Representative majorities. This will enable him to reverse any aspects of Biden’s Inflation Reduction Act that may be unpopular with fossil fuel lobbies that backed his election.
However , it is too late for Trump to influence the speed and extent of energy transition across the world, much of which has already attained an irreversible momentum.
During Trump’s four-year absence from White House, the energy transition from fossil fuels to renewables has significantly shifted from the realm of politics and climate activists to become a major global economic activity with significant investments in development of renewable energy technologies.
Trump will have to reckon with the US lagging in renewable energy investments, with expectations that he will use the tariff weapon to protect US jobs in both fossil fuels and emergent energy technologies.
He will also need to acknowledge that the US oil and gas industry did actually expand and significantly under the Joe Biden administration, mainly due to impacts of the Ukrainian war that redefined global oil and gas supply chains.
The US has in the past two years increased oil and gas production and exports at the expense of Russia and Middle East — and this trend continues.
When Trump returns to White House, his first actions will likely include reversal of Biden’s suspension of LNG exports from the US, which has proved unpopular with oil and gas lobbies.
The first actions may include relaxation of Biden’s exploration, drilling, and pipeline restrictions. Predictably, Trump will have no time, sympathy or money to “waste” on the ongoing global clamour for climate finance for the developing world.
In geopolitics, Trump will likely re-establish political partnerships with the global strongmen of Russia, Israel, Hungary and Saudi Arabia, with whom he can shape a different world order, which may include solutions for conflicts in Ukraine and Palestine.
China, the EU and developing countries will need to redefine how they deal with a comeback and more empowered Trump. Specifically, Trump will find a more powerful President Xi who has acquired greatly enhanced global influence and appeal.
Back to energy and climate, Trump’s return will give fossil fuel interests increased confidence to maintain their space in the ongoing energy transition competition.
However, it is investors more than politicians that will influence the pace of achieving climate change goals. It is also increasingly evident that any political leadership is unlikely to take any climate-related action that may lead to loss of jobs, and increased prices of energy and goods.
The writer is an energy consultant
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