'Drill, Baby, Drill': One Year on From Trump's Energy Pledge

It has been just over one year since Donald Trump was sworn in for a second term as US President.

During his inaugural address on 20 January 2025, President Trump repeated one of his favourite slogans from the campaign trail: “Drill, baby, drill”.

On that day last year, few doubted that he would make good on that promise to reinvigorate the US’ fossil fuel industry, such was the vehemence with which he campaigned.

One year later, the Trump administration's aggressive pursuit of expanded fossil fuel extraction has reshaped America's energy landscape and sent ripples through global markets, though not always in the ways the President’s proponents had envisaged.

A sweeping regulatory overhaul

Within hours of taking office last January, Trump had signed 26 executive orders – more than any president in American history had done on their first day.

One of his first actions was to declare a national energy emergency, launching an unprecedented rollback of climate protections and environmental safeguards. 

His executive order Unleashing American Energy rescinded Biden-era policies prioritising climate action and opened vast tracts of federal land to drilling. 

The Interior Department established a 28-day target for processing drilling permits, dramatically accelerating approval timelines.

Following on from another executive order signed that day, the Trump administration has opened Alaska's Arctic National Wildlife Refuge coastal plain to oil and gas leasing and reversed protections on more than 13 million acres of the National Petroleum Reserve. 

These moves fulfilled long-standing Republican ambitions, though lease sales have attracted limited industry interest thus far, with one auction in early 2025 drawing zero bidders.

In November, the administration proposed an expansive offshore drilling programme spanning approximately 1.27 billion acres. 

The plan includes six lease sales off of California's coast – the first such sales since the Reagan administration in 1984 – and drilling in the eastern Gulf of Mexico near Florida, breaking decades of precedent. 

Both proposals have sparked bipartisan opposition, with governors from California and Florida vowing legal challenges.

The One Big Beautiful Bill and the industry response

In July, Congress passed what is perhaps the Trump administration’s most defining piece of legislation to date, the One Big Beautiful Bill Act.

The legislation package, which covers all manner of policies, involved the American energy sector heavily.

The bill mandates rolling lease sales through 2040, reduces royalty rates for oil and gas companies and lowers bonding requirements, potentially leaving taxpayers liable for clean-up costs. 

The legislative package also provided approximately US$80bn in tax breaks to the fossil fuel industry over the next decade, including an enhanced carbon capture credit and accelerated depreciation for drilling equipment.

Yet the industry's response has so far been measured.

Despite the newfound regulatory freedom, the number of active drilling rigs declined by more than 6% year-on-year across the States, as companies showed little appetite for expansion.

This was influenced by oversupplied global markets and crude prices below US$60 per barrel. 

According to Cinnamon Edralin, Americas Research Director at Westwood Energy, these trends contributed to "a wider softening of demand that we are seeing in the global market in response to lower oil prices and continued high project costs".

Major banks have also continued to rule out financing for Arctic projects, citing environmental concerns and economic viability as the main reasons.

That said, Arctic drilling projects like the Willow Project and the Pikka Project – both of which were approved by the Biden administration – in northern Alaska, have not been developed with assistance from banks.

The former is being funded by petroleum giant ConocoPhillips to the tune of US$9bn, while the latter is a joint venture of Santos and Repsol.

The impact on the global energy market

Trump's second term policies have reverberated beyond American borders.

The administration has applied a great deal of pressure to international institutions, threatening to withdraw from the International Energy Agency (IEA) unless it modifies forecasts showing fossil fuel demand peaking by 2030. 

The President has also often used trade negotiations to secure energy deals, with the EU pledging to purchase US$750bn in US energy resources over three years.

Paradoxically, while Trump has retreated from climate accords like the Paris Agreement and even committed to dismantling active wind turbines, global renewable energy has continued its ascent. 

Solar and wind power overtook coal in the worldwide energy mix for the first time in 2025, driven primarily by massive investments in China and India. 

The IEA reduced its US renewable capacity growth projections by 50%, but still expects global renewable expansion to accelerate through 2030.

Oil prices fell roughly 20% over 2025, though this owed more to OPEC production increases and global surplus than Trump’s drilling policies. 

Some analysts credit Trump's diplomatic pressure on OPEC for contributing to lower crude prices, which translated to American households spending an average of US$177 less on petrol in 2025.

An uncertain legacy

As Trump's second year in office begins, his "drill, baby, drill" agenda has delivered a transformed regulatory environment but not the production boom he may have hoped for. 

Instead, 2025 saw some mounting legal challenges, caution from investors and rising electricity prices, despite Trump’s promises of dramatic reductions. 

The speed of change common in both the global energy market and President Trump’s administration suggest that this will not always be the case, though. 

The US intervention in Venezuela, followed by the President’s statements of intent regarding the country’s oil reserves, suggest that drilling is still very much a core part of Trump’s plans for the remainder of his presidency.