U.S. tariffs worldwide will be better for the industry over the long run, even though oil prices have slid, said Bud Brigham, a longtime Lower 48 wildcatter who was an early shale developer in the Bakken and southern Delaware Basin.

“Assuming the goal of the tariffs is freer global trade, which should be achievable, the tariffs could be temporarily disruptive but long-term very beneficial,” he told Hart Energy.

The prompt-month WTI contract was trading at about $56 when Hart Energy polled operators. It jumped mid-day to $62 as President Trump postponed reciprocal tariffs for 90 days, while increasing the pressure on China to 125%.

The tumble is from $75 on Trump’s inauguration, Jan. 20.

Hart Energy asked for producers’ takes on the lower oil price, whether the U.S. stoking a tariff war is a good idea, and what happens next on capex budgets and U.S. wildcatting on new-field plays.

Oil and gas securities analysts have reported that wildcatting, in particular, will be most displaced.

Among Brigham’s diversified business interests, he operates an oilfield sand-mining and transportation company, Atlas Energy Solutions, in the Permian Basin.

Oil prices will rebound, he said. “The $50s are not sustainable.”

Thus, $50 oil will mean prices rise: “To the extent oil prices are at such low levels will be the extent to which oil prices will rally in time,” he said.

In short, the industry adage—the cure for low oil prices is low oil prices—applies as overall production declines make the commodity more scarce and thus more valuable.

‘Not helping’

On the other hand, a publicly held Permian operator who didn’t want to be identified told Hart Energy, “It’s certainly a mess and not great for our industry. Hope we get some clarity soon.”

Meanwhile, industry veteran Robert Anderson was concerned about the whipsaw effects prices could have on dealmaking.

“This volatility is not helping the A&D market,” he said.

Anderson is the former CEO of Permian-focused Earthstone Energy, which sold to Permian Resources in 2023 in a $4.5 billion sale, including debt assumption.

Anderson is now CEO of privately held Petro Peak Energy.

“I would also expect that, if this price is sustained, activity levels in oil areas should come down,” he said.

In the Utica oil and Marcellus shale plays in the Appalachian Basin, Zack Arnold, president and CEO of Infinity Natural Resources, told Hart Energy the newly public E&P’s business model will be fine.

“Our strong balance sheet—little to no debt—and current commodity hedge levels give us the flexibility to thoughtfully develop our uniquely balanced acreage position,” he said.

‘Painful, but’

John Jacobi was glad to see the tough talk, particularly directed at China.

“It had to happen,” said Jacobi, who built Haynesville gas-focused Covey Park Energy to a $3.3 billion sale, including debt assumption, to Comstock Resources in 2019 and more recently led oil-focused Javelin Energy Partners in the Eagle Ford Shale and Uinta Basin.

U.S. oil producers “learned their lesson” in 2020 when demand plummeted at the onset of COVID to less than $0 momentarily and steadily held in the $20s, Jacobi said.

Since then, operators tightened capex budgets and began focusing on free cash flow, he noted.

“But through the price recovery, not all the bad habits went away,” he said. “More responsible, smart, efficient people need to be running our business.”

And the U.S. needs to disconnect from cheap goods from China.

“We’ve got to go through the pain to get our jobs back. I can’t pay a person $20 an hour to do manual farm labor that a teenager should be doing. I can’t pay them $30 an hour. Everyone wants a free ride today.”

The economic outlook now is “painful, but the strong will survive. We have to go through this for the republic. … Oil needs to be cheap; it needs to be $50.”

He expects the downturn may last 18 months. “It’s going to be painful but somebody had to do it.”

In mid-conversation, the White House announced the 90-day delay and increasing the tariff on China.

Jacobi said it means Trump’s “forceful nature on this is working for America.”

While the oil industry may be unbothered by $2.50 and $3 gasoline, for those “not in this business, $2 gas is better. They’ll use more than at $2.50.”

Eventually, “the oil price will recover,” he concluded.

Seven U.S. senators, including Rand Paul (R-Kentucky), are working to force a vote this week to repeal the tariffs. House members are working on a similar measure.

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