EPA Chief: ‘Do Not Underestimate President Trump’ on Tariff Outcomes

OKLAHOMA CITY—“Do not underestimate President Trump” was U.S. Environmental Protection Agency (EPA) Administrator Lee Zeldin’s take on the chances for a successful outcome for plans to tariff most U.S. imports.

Zeldin spoke April 24 at Oklahoma State University’s Hamm Institute for American Energy in a summit on powering AI.

Zeldin’s confidence about the end result is while many in the oil and gas industry are nervous.

Research firm Wood Mackenzie reported on April 23 that “the global oil industry is bracing for a crisis.” In the U.S., in particular, “tariffs could increase costs by up to 4% onshore and up to 14% offshore.”

J.P. Morgan Securities reported earlier in April that at least 50—and up to 100—of the roughly 600 rigs drilling in the Lower 48 may be idled in response to the newly discounted WTI strip.

And U.S. producers told Hart Energy in early April that a lower oil price is “a mess” but that tariffs “had to happen.”

Zeldin said at the summit that Trump had done much work on getting a better deal from China during his first term.

“It was a tough negotiation with China,” Zeldin said. “There was all sorts of progress that was starting to come online … and I had an extraordinarily renewed and confirmed trust in President Trump.”

But COVID-19 struck in 2020, disrupting global trade markets before Trump left office in January 2021.

“He didn’t just become president and decide he wanted to tackle these issues. He’s been talking about this philosophy for decades,” Zeldin said.

Near-global tariffs took effect on April 3 but Trump put a 90-day pause on them hours later as both U.S. stock and Treasuries markets immediately began to tank.

On April 2, the Dow fell from a 42,225 close to end at 40,545 the following day, after recovering some deeper losses in intra-day trading before Trump issued the pause.

 Further market discontent pushed it to a 37,645 close April 8. The index closed at 40,113.50 on April 25.

Zeldin noted that Trump renegotiated the North American Free Trade Agreement (NAFTA) with Canada and Mexico in 2020. At the time, Zeldin served in the House of Representatives, representing his district in New York.

“There were a whole lot of people around me that said it couldn’t get done and it did,” Zeldin said.

The pact is known as the U.S.-Mexico-Canada Agreement (USMCA).

AI dominance

When asked if Trump’s plan for tariffs nearly worldwide would help or hurt U.S. plans to remain dominant in AI, Zeldin said, “I would tell the American public, ‘Do not underestimate President Trump and his ability to lead these negotiations.’

“I’m excited about where these negotiations can go.”

The potential is there for talks with “one country after another [for] a better situation, better deal, better terms [for the U.S.] than what we had going into it.”

Agriculture Secretary Brooke Rollins said, “This is not just one country and America negotiating. This is an around-the-world effort.”

Rollins was asked if the agriculture department was ready to help farmers affected by reciprocal tariffs on their products.

“We are working to expand markets while these renegotiations are happening,” Rollins said. “I got a report this morning from those who [were] in the room that we’re very close on a good number of countries. That is going to be extremely, extremely beneficial for some of our farmers and ranchers, especially our row croppers.”

Energy exclusion

Interior Secretary Doug Burgum said at the summit that he, Energy Secretary Chris Wright and others in the administration “advocated for the exclusion of energy from a lot of these discussions.”

“And I think that’s a core principle that the president’s adopted,” Burgum said. “That’s a good one because we know that we have to have a free flow there.”

But, he added, “we also know that there are a lot of supply-chain elements that affect this [energy] industry.”

Midnight on April 2 wasn’t “the finishing line. It’s the starting line.”

There are 35 or so bilateral negotiations underway with trade partners “and there’s a team of talented people working on these. And I think that in every case, we’re going to end up with a more open, more reciprocal trade than where we started.”

Ultimately, it should be a better deal for U.S. industry, Burgum said. “At a base level, our economy was open to the world and the world’s economy was not open to us.”

The energy industry “may not have noticed that as much as other industries,” he said.

But foreign manufacturers will come to understand “if you want to avoid a tariff at all, now or in the future, manufacture it in the U.S.”

“That capital is going to come here,” Burgum said. “I know it’s coming here. So, in that way, President Trump is like an economic developer’s dream because capital is flowing in.”

It should result in more energy demand domestically, he said.