
Donald Trump’s victory in the 2024 elections will shake climate policy in the US and internationally. Overall uncertainty and volatility will increase. There is likely going to be a lot of litigation and concerns raised by states, companies and NGOs against regulatory rollbacks. Trump's second term is likely to slow down US emission reductions, but based on history and already agreed action, a complete halt is not expected to happen.
The central policy tool of the US, the Inflation Reduction Act (IRA), and current initiatives will likely be adjusted rather than entirely repealed. There's also an interest from the Republicans and the manufacturing industry to maintain many of the already agreed tax credits.
The business environment differs significantly from Trump’s first term. Unlike in 2016-2020, a possible reversal of the US climate policy is counteracted by market dynamics, reduced costs in clean technology and overall technological and manufacturing competition with China, which is another key policy objective for the administration.
In the short term, oil and gas seems to be the main beneficiary since the incoming administration has promised to cut regulations and ease permitting for the industry. How much that will increase production is an open question. US oil and gas production has already reached historic highs, and the black and white rhetoric of the campaign will be counteracted by how much additional demand for oil and gas exists in the global economy. The risk of oversupply and downward pressure in prices is real.