California Governor Gavin Newsom strongly opposed the Trump administration’s reported intentions to expand offshore drilling in California, as the International Energy Agency (IEA) on Wednesday predicted global oil and gas demand could grow until 2050.
Newsom’s Strong Opposition
Newsom, during a press conference at the COP30 climate conference in Brazil, voiced the widespread disapproval of offshore drilling in California, cutting across party lines. He dismissed the Trump administration’s reported plans as being “dead on arrival.”
"As it relates to offshore oil drilling, it's overwhelmingly opposed by members of all political parties in the state of California," said the Governor.
Newsom also took a dig at President Donald Trump, saying it’s “remarkable” that he didn’t promote the drilling off the coast of Florida that houses his property, Mar-a-Lago.
Reports Of Trump’s California Drilling Plan
Several news outlets on Tuesday have reported that the Trump administration is weighing plans to expand offshore drilling along the California coast and in the eastern Gulf of Mexico.
A draft map obtained by The Washington Post indicates that six drilling rights auctions could be held off California's coast between 2027 and 2030. Meanwhile, The New York Times, citing three sources familiar with the matter, said the proposal allowing drilling in the area could be announced as soon as this week.
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California Drilling Paused In 1984, Florida Ban Stands
Permitting new drilling off California's coast would mark the first such opportunity since 1984, though older leases issued before that time still produce some offshore oil.
As for Newsom’s comments on drilling off the coast of Florida, Trump, during his first term, imposed a ban on offshore drilling near Florida's coast, Georgia, and South Carolina, extending through mid-2032.
Trump’s ‘Drill, Baby Drill’ Push And IEA’s U-Turn
The Trump administration’s focus on increasing domestic oil production has been evident in recent months. In early November, Doug Burgum, the Secretary of the Interior, highlighted America’s renewed energy dominance under Trump, amid record-breaking domestic oil production of 13.6 million barrels per day.
Moreover, in late October, Trump hinted at a potential oil and gas deal between Alaska and China after a meeting with Chinese President Xi Jinping, delegating the responsibility for the same to Energy Secretary Chris Wright and Burgum.
Meanwhile, IEA, the West’s energy security watchdog, has been under pressure from Trump for a shift in recent years towards clean energy policies. Under the Joe Biden administration, the agency predicted that global oil demand would peak this decade and said no more investment in oil and gas was needed if the world wanted to achieve its climate target.
However, on Wednesday, the IEA changed its stance and said global oil and gas demand could grow until 2050, departing from its previous expectations of a speedy transition to cleaner fuels and predicting that the world will likely fail to achieve climate goals.
Price Action: The U.S. crude oil prices rose 2.63% over the month, trading at $60.41 per barrel at the time of writing.
The Energy Select Sector SPDR Fund (NYSE:XLE), which provides broad-based exposure to the oil and gas industry, is up just 5.62% year-to-date, while the SPDR S&P Oil & Gas Exploration & Production ETF (NYSE:XOP) is down 0.51% during this period, as per data from Benzinga Pro.
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