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Analyst Recommends Selling Oil Stocks Under Trump Presidency

Oil workers

Donald Trump’s ‘Make America energy independent’ vision could backfire in an already oversupplied energy market and hurt oil companies’ profits should he win the November election, and investors would be wise to sell oil stocks under a Trump presidency, Quartz quoted an analyst as saying on Tuesday.

Even if Trump fulfills his promises to lift unnecessary regulations and “unleash America’s $50 trillion in untapped shale, oil, and natural gas reserves, plus hundreds of years in clean coal reserves”, Andy Goldberg at JP Morgan Asset Management told Quartz that higher output will add to the current energy glut. This, according to Goldberg, “might actually hurt energy prices, which might hurt profits and hurt the market”.

Although Trump’s view is clearly a pro-business policy, investors should watch out for its unintended consequences, Goldberg says.

At a September meeting in Pittsburgh, Trump outlined his America-First energy plan:

“This means opening federal lands for oil and gas production; opening offshore areas; and revoking policies that are imposing unnecessary restrictions on innovative new exploration technologies.”

Trump’s energy plans are focused on achieving a full American energy independence. He has even vowed to save the U.S. coal industry. He is also a supporter of oil deregulation, and tried last week to assure Colorado oil executives of his support, following some ambiguous remarks on fracking he had made in July. Trump is not a big fan of renewables, unlike his Democrat opponent Hillary Clinton.

The unconventional and increasingly controversial pick for a Republican presidential nominee is trailing Clinton by 9 points among likely voters in a three-day poll carried out between Saturday and Monday, according to The Wall Street Journal. But if Trump manages to clinch the U.S. Presidency, Andy Goldberg at JPMorgan Asset Management says: sell oil stocks.

By Tsvetana Paraskova for Oilprice.com

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  • George on October 12 2016 said:
    So, definitely "BUY"! Since the SCAM and LIE are the routines of these so called analysts!

    Anyway, once Hussein Obama get out of the white house, the oïl price will rise significantly!

    All those US inventorie reports are FAKE, with an unique goal to hurt Russia! But fail! :-)

    US actually IMPORT massively oïl from the Middle east! (The oïl over-supply is a BIG LIE!)
  • jack ma on October 11 2016 said:
    De-dollarization by Russia and the BRICs has caused the West to crash oil but to no avail in that Russia is still standing. Globalization is failing on all fronts but to my point, you can now buy this beaten down industry at 80 years lows from offshore drillers to fracking to dry shippers to storage space You should be accumulating these stocks if the balance sheet screams 'buy me' The appointed president is a mere puppet to big oil and elites so it makes no matter who sits has puppet in the Whitehouse. This is the time to buy and by all means, do not waste this crisis. Maybe this article is simply anti Trump. Make your own investment choices. The petrodollar collapse and the Syrian pipeline war scream geopolitics and that in turns scream buy the dips in oil and oil service firms. I am sitting now with over 70,000 shares of various energy firms that I believe are all 5 baggers in 2018. Warmest regards. JM
  • Cori Handsaker on October 11 2016 said:
    This is getting ridiculous...

    Hillary hates big oil too. So wth does it matter?

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