Shale executives slam Trump's tariffs in latest Dallas Fed survey

(Bloomberg) – Executives at U.S. shale companies expect President Donald Trump’s 25% steel import tariffs to lead to lower activity in the shale patch, according to the latest energy survey from the Federal Reserve Bank of Dallas.

The average price for West Texas Intermediate that companies need to profitably drill rose to $65 a barrel, up from $64 from last year, according to the bank’s survey of 130 oil and gas firms from across the Southwest released Wednesday. Most contractor executives expect the impact of steel tariffs to slightly decrease customer demand in 2025. Survey respondents called for policy stability from the Trump administration, citing the need to decrease capital spending.

“This is not ‘energy dominance.’ The U.S. oil cost curve is in a different place than it was five years ago; $70 per barrel is the new $50 per barrel,” an unidentified executive said in the report. “In a strange twist to the administration’s hope for more domestic oil and gas production, higher steel tariffs may result in fewer wells completed due to higher completion costs,” another respondent said. “This will likely result in downward pressure on total wells brought online.”

The Dallas Fed’s quarterly surveys are widely read for the anonymous comments that offer an unfiltered view on factors impacting the oil industry. The bank’s region covers Texas, northern Louisiana and southern New Mexico. 

“The administration’s chaos is a disaster for the commodity markets,” another executive said in the survey. “’Drill, baby, drill’ is nothing short of a myth and populist rallying cry. Tariff policy is impossible for us to predict and doesn’t have a clear goal. We want more stability.”