President Donald Trump’s policies are getting in the way of drillers from pumping more oil, producers and career oilmen say, warning that low prices threaten thousands of jobs.

Throughout Trump’s second administration, oil prices and the number of rigs active in the United States have steadily fallen, while supply chain costs for producers nationwide have shot up. 

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These market conditions have strained smaller drilling companies in the Permian Basin in West Texas and southeastern New Mexico, forcing many to shut down some of their rigs. 

One key metric producers have been following is the 12-month strip, the projected 12-month average price for crude oil, which drillers use to manage the risk and profitability of wells. As of Thursday, that number was around $61.50 per barrel, Kirk Edwards, an Odessa oilman and former chairman of the Permian Basin Patrol Association, told the Washington Examiner.

“That is not a good price that these oil and gas guys that are drilling in the Permian want to see,” Edwards said, adding, “It is very marginal to try to drill a well with these prices. If this continues, you’ll see even more drilling rigs start coming down.” 

As of last week, data released by Baker Hughes found nearly 50 fewer rigs were active in the U.S. than at the same time last year. 

Edwards said crude prices would need to remain between $70 and $75 for a long period of time, not just a couple of weeks or months, in order to bring these rigs back online and pursue new drilling opportunities. 

Until then, drillers have hesitated to make significant investments amid such volatile market conditions, delaying Trump’s “drill, baby, drill” plans.

“Our term right now is ‘wait, baby, wait,’” Edwards told the Washington Examiner. “Nobody is going to go out and drill at this price.” 

Recent oil market reports released by the Energy Information Administration and International Energy Agency warned this week that supply will continue to outpace demand this year and next, further depressing prices. 

Analysts forecast that crude prices could drop below $60 by the end of 2025 and near $50 per barrel throughout 2026. For many producers, these levels are unsustainable, risking thousands of jobs. 

Edwards told the Washington Examiner that at least 70 rigs were lost in the last three to four months, each supporting roughly 100 jobs. 

“If you’re on the drilling side, you’re really seeing some big layoffs happening,” he said, noting that production divisions should maintain their employment levels. 

“You’re seeing a massive drop off in what we call the frack crew counts,” Edwards added. “They are really falling by the wayside.” 

Karr Ingham, president of the Texas Alliance of Energy Producers and a petroleum economist, agreed that the industry is seeing some job losses right now, but described them as “minor” compared to what they could be if oil drops to $50 for an extended period. In that case, Ingham said there would be “significant” layoffs. 

OPEC+’s decision to flood the market with supply this summer has driven a large part of this low-price environment. Other pressures, though, have come directly from the Trump administration and its tariffs on steel and aluminum. 

Large and small producers have griped about the tariffs for months, claiming they conflict with Trump’s goal of increasing production. 

“These tariffs are doing nothing to strengthen the demand picture. I promise you that, if anything, they’re only weakening the demand picture,” Ingham said. 

While Ingham is largely pleased with the administration’s favorable stance toward the fossil fuel industries, regulatory reforms have not been enough to support more production.  

“The tariff situation is troublesome for oil and gas. It raises costs directly to them, and then it causes economic uncertainty, which affects demand for what they produce, which is all mattering right now, because you don’t have demand growth, may not have demand growth at all. If you do, it’s insufficient to compensate for the supply growth,” he told the Washington Examiner. 

While prices and the rig count have dropped, drillers have been able to maintain or slightly increase their production levels this year. Earlier this month, the EIA reported that the U.S. saw record crude production in May. 

That is not expected to carry throughout the year, as producers like Diamondback Energy have insisted the U.S. has already hit peak production and will begin to fall. 

OIL PRICES PROJECTED TO FALL BELOW $60, RISKING TRUMP DRILLING GOALS

When asked if Secretary Doug Burgum, as the chairman of the National Energy Dominance Council, had any response to the growing criticism, an Interior Department spokesperson told the Washington Examiner: “In line with President Trump’s agenda, the Department of the Interior is unleashing American energy by eliminating bureaucracy, removing wasteful and costly regulations, and permitting new projects at record pace, which makes energy more affordable for the American family and enables greater American prosperity and economic security.”