Gulf welcomes Trump’s hands-off approach to energy policy

Trillions were pledged in AI and energy, but Opec stayed out of the spotlight

May 22, 2025, 4:07 PM

U.S. President Donald Trump is welcomed by Saudi Crown Prince Mohammed Bin Salman in Riyadh, Saudi Arabia, May 13, 2025. REUTERS/Brian Snyder TPX IMAGES OF THE DAY — President Donald Trump in Riyadh with Crown Prince Mohammed bin Salman. During his visit to Saudi Arabia, Trump did not raise Opec+ policy in private discussions

US President Donald Trump’s visit to the Gulf region last week helped to turn the page on lukewarm relations with the previous Democratic administration.

The trip yielded trillions of dollars in pledged investments between the Gulf states and the US, covering sectors such as artificial intelligence, manufacturing and energy. However, sustaining this momentum will depend on higher oil prices to bolster the region’s fiscal capacity.

Since returning to the White House, Trump has pursued lower oil prices and issued a steady stream of tariff announcements – both of which have clashed with the interests of oil-exporting nations by dampening sentiment around global oil demand.

Trump has repeatedly stated that he wants oil prices to fall to $50 per barrel, fuelling speculation that the recent Opec+ decision to unwind production cuts was a response to his pressure.

However, during his visit to Saudi Arabia, the UAE and Qatar, Trump made only brief public references to oil prices – and, according to individuals familiar with the matter – did not raise Saudi Arabia or Opec+ policy in private discussions.

According to US energy insiders, Trump appears satisfied with current oil prices

In Riyadh, Trump went on to emphasise that he opposes western “intervention” in the affairs of other nations and that he would not give “lectures on how to live”.

Those remarks hit a home run on many levels, particularly on issues like the energy transition, where Gulf states have long felt patronised by Western narratives. As a result, when Opec considers its next policy move, Trump’s stance is unlikely to be a direct influencing factor.

Conversely, the internal dynamics within the group, including compliance with quotas and keeping cohesion, will continue to be the main factors guiding decision making. For now, the group appears well positioned to continue its sped-up unwinding during the summer months, as seasonal demand will help buffer the added production.

Days before his Gulf visit, Trump’s easing of tariffs on China gave oil prices room to rebound, stabilising at about $65 a barrel – a level that has held since.

According to US energy insiders, Trump appears satisfied with current oil prices, enough to claim victory and avoid making any further public demands on Opec+.

Gulf officials and other members of the Opec+ alliance have privately suggested that a softening of Trump’s tariff policies is likely – an outcome they believe could help reverse some of the more pessimistic forecasts for oil demand growth this year.

“Assuming that reasonable trade agreements are reached with most of the United States’ trading partners, global economic uncertainty is expected to ease,” Opec’s latest monthly crude outlook report said.

Nevertheless, the absence of energy from Trump’s public remarks did little to dampen deal activity. At the Saudi-US investment forum in Riyadh last week, roughly half of the $300 billion in agreements signed were related to the energy sector.

This included a plan by Saudi Aramco to invest $3.4 billion to expand the Motiva refinery in Texas to integrate chemicals production and a non-binding agreement with Australia’s Woodside to explore global opportunities. This includes a potential acquisition by Aramco of an equity interest in an LNG offtake from the Louisiana LNG project.

Other MOUs signed with the Saudi energy ministry were in the oil and gas sectors, peaceful uses of nuclear power, renewable energy, energy efficiency and carbon capture.

No easy recovery for Syria

One of the most significant announcements during Trump’s visit was the lifting of sanctions on Syria, a move for which he tactfully credited Saudi Arabia’s Crown Prince.

“Oh, what I do for the crown prince,” Trump said during a speech in Riyadh. The next day, Trump shook hands with Syrian President Ahmed al-Sharaa, who was flown into the city.

But what does this mean for Syria’s war-torn economy and decimated upstream oil sector? In short, any recovery will demand tens of billions of dollars to restart drilling and rebuild the infrastructure needed to restore pre-war production levels of around 380,000 barrels per day (bpd).

As of now, Syria’s oil production stands at just 86,000 bpd and is almost entirely controlled by Kurdish-led forces in the northeast.

Even in an optimistic scenario, independent energy data provider Kpler thinks it will take several years for Syria to achieve additional sustainable production in the range of 50,000-100,000 bpd.

Amena Bakr is head of Middle East energy & Opec+ Insights at Kpler