By Anthony Harrup


A second presidential term for Donald Trump is likely to keep oil prices under pressure in 2025 by easing regulations on U.S. producers and potentially spurring the Organization of Petroleum Exporting Countries to speed up the return of withheld output, analysts at Citigroup said.

Global economic implications are mixed, but negative especially for Europe and China, which are more exposed to the risk of trade tariffs, while tariffs could make a further dent on global oil demand growth, especially for diesel, Citi said in a report Wednesday. Other possible impacts on oil include reducing geopolitical tensions and releasing some oil-on-water back into the market.

On the other hand, "there is a risk that Trump imposes more sanctions on oil-producing countries like Venezuela and Iran, which could have bullish effects on oil prices," Citi added.

A Trump administration would be more favorable to the oil and gas industry, and could increase leases on federal land, lower lease rates and offer greater and more productive acreage, although that would have limited immediate effect on physical markets, the analysts said. They noted that already under President Biden's administration U.S. oil production has reached record highs.

"Broader market conditions look more binding on constraining U.S. oil and gas production growth than regulatory factors," Citi said.

Oil futures settled little changed Wednesday, picking up from the early selloff that followed the news of Trump's election victory.


Write to Anthony Harrup at anthony.harrup@wsj.com


(END) Dow Jones Newswires

11-06-24 1818ET