Trump’s energy dominance boosts US fossil fuel production but faces market realities: renewables keep growing, long investment cycles slow change, and allies diversify. Geopolitical gains are real, but China’s green-tech lead may widen as global transition continues.
At first glance, the Trump administration’s energy dominance policy appears to have been a success. But shifting energy market dynamics has proven difficult.
Ever since US President Trump declared a national energy emergency on his first day in office last year, energy has been a major focus of his administration. He aims to achieve ’dominance’ by growing the fossil fuel, nuclear and critical minerals sectors to fill domestic markets and lead global ones. Renewables are pushed aside by revoking regulations, subsidies and even approved projects.
What is clear is that US oil and gas production are surging – oil to record levels, and liquefied natural gas (LNG) exports growing more than 20 per cent.
Longer term, Trump wants similar growth in coal and nuclear power. After coal’s precipitous decline in recent years, his administration has thus far managed to keep five US coal-fired power plants open by removing pollution regulations, offering investment assistance, and even ordering the Pentagon to purchase coal-generated electricity. On nuclear, Trump has set a goal of quadrupling US atomic power generation by 2050 and has moved aggressively to ease permitting at home and build new commercial nuclear partnerships abroad, including with the UK.
But the Trump administration’s energy dominance goals go beyond making the United States a hydrocarbon hyperpower. As Secretary of State Marco Rubio spelled out at the Munich Security Conference, the administration sees the global shift to renewables as a source of leverage against Washington – and US allies must follow it in changing course.
One of the brains behind energy dominance, Diana Furchtgott-Roth, argues that America’s growth under a pro-energy regime will force other countries to reconsider their own policies or face economic decline.
US allies like the EU, Japan and South Korea have responded by pledging to purchase and/or invest in US energy production. Saudi Arabia, meanwhile, led OPEC countries in increasing oil production in 2025, helping put global production at an all-time high. Washington now has direct or indirect influence over oil output from Canada through to Guyana and Venezuela – approximately 20 per cent of global oil production. Enough, analysts argue, to limit price spikes and give the Trump administration freedom of action in global politics.
Indeed, energy dominance has both domestic and foreign policy goals. At home, it aims to enrich US producers and lower prices for consumers – two sometimes contradictory goals. Abroad, it again aims to empower US energy companies, particularly those who are major players in the development of Middle Eastern LNG. Washington also hopes that a stable and diverse oil supply helps prevent Iran, Russia or other actors from using energy prices to put pressure on Washington, for example in response to further attacks on Tehran.
But energy dominance also has an ideological side. The aim is to defeat what Rubio has called the ‘climate cult’ and with it both Beijing’s dominance of green energy technology and cooperative global efforts at energy transition.
Dominance is perhaps not what it seems
At first glance, Trump’s energy dominance appears to be a success so far. But three key points indicate that all is perhaps not what it seems. First, global demand is driving increased production of all types of energy – including green energy. Second, long-time horizons for energy generation mean today’s headline new plants were planned five to ten years ago. Today’s policies will also need that kind of staying power. Third, from Trump’s energy dominance to Europe’s quest for energy security to global efforts at energy transition, there are many attempts to put politics over energy markets. But markets continue to reassert themselves.
Climbing energy use, demand for air conditioning in emerging economies, and AI and data centres in OECD countries saw production and use of every kind of energy increase last year, from oil and gas to green and nuclear. Even as coal use remained stable globally and rebounded in the US, renewables generated more power globally than coal for the first time, and new capacity in solar and wind was enough to account for all of global energy demand growth.
Domestically, the Trump administration’s efforts to shift marketplace dynamics had mixed results. Shale oil producers did not see prices high enough to spur growth, while renewable energy continued to outperform administration rhetoric. Although US investment in renewables declined from 2024 highs, overall renewables made up a large majority of new power generation capacity in 2025. Investment in renewables also outpaced investment in fossil fuel production, and solar energy now competes favourably on price alone. This suggests that market fundamentals will continue to drive a US energy transition, albeit at a slower pace.
Geopolitical impact
Internationally, the geopolitical ramifications of the US move to oust Venezuelan President Nicolás Maduro and supervise the country’s oil production are dramatic. Washington is already using Venezuela to cut off oil supplies to Cuba and pressure India to stop buying discounted Russian oil. Coupled with new moves or even military action against Iran, in principle this increases pressure on Moscow but also Beijing, a key beneficiary of cheap Russian and Iranian oil. The intended beneficiaries are US producers in the Western Hemisphere, US companies globally, as well as Gulf OPEC producers who are key partners of Trump.
In the Middle East, Trump – and many US leaders before him – has been frustrated by the ability of OPEC members to threaten price increases and destabilize the US economy. Increased domestic and hemispheric oil production has been viewed as a way to gain freedom of action in the Middle East. By that metric, the Trump administration’s ability to carry out multiple military operations in the region – and threaten more – without debilitating oil price spikes is a sign of success. However, US companies’ increasing involvement in Middle Eastern oil and gas production mean that US interests will continue to be heavily engaged in the region for decades to come – the exact opposite geopolitical outcome of what Americans thought domestic energy growth would achieve.
But energy markets may not follow geopolitics quite this neatly. Washington’s policies are unlikely to reverse the global energy transition, meaning an unintended beneficiary of its new energy policies is likely to be China’s green-tech dominance. Meanwhile, industry leaders have advised Trump that a significant uptick in Venezuelan oil production would demand infrastructure investments and rule of law improvements that would take years – but such efforts are unlikely to be high on Washington’s list of priorities. Indian agreement to replace Russian with Venezuelan crude turned out to be only agreement in principle. And it remains to be seen how stable markets are in the event of a large-scale attack on Iran.
A world of all-of-the-above energy policies gives allies in Europe and Asia room for manoeuvre even as Washington pushes them to fall in line. They can move forward on green energy, buy LNG and cooperate on nuclear with the US, and diversify with Qatari gas and French or Korean nuclear technology. US allies might just realize that the opposite of energy dominance is not submission, but diversification.