President Donald Trump is a fierce backer of the fossil fuels industry. And that support is paying off big time in the money race.
Trump is crushing Joe Biden in campaign donations from the embattled oil-and-gas industry. The president and outside groups aligned with him have raised nearly $13 million from individuals at oil-and-gas companies, according to OpenSecrets, a research group that tracks money in politics. That easily dwarfs the $976,000 the industry has sent to Biden.
It’s not shocking that the oil-and-gas industry is firmly in Trump’s camp. Not only do oil-dominant states like Texas, Oklahoma and North Dakota reliably vote Republican, but Trump has touted an agenda of American energy dominance marked by cutting environmental regulations and pushing energy exports.
Still, the magnitude of Trump’s money advantage far exceeds those of Republicans in each of the past three presidential races, according to OpenSecrets.
For instance, in 2016 the oil-and-gas industry only sent $24,000 more to Trump than Hillary Clinton and groups aligned with the former Democratic presidential nominee. In 2012, GOP nominee Mitt Romney outraised former President Obama $5.9 million to $841,000. And in 2008, former US Senator John McCain only raised about three times as much as Obama.
“Regulatory policy is tilted very aggressively towards the oil industry. And the industry wants to keep it that way,” said Greg Valliere, chief US policy strategist at AGF Investments.
Trump, who is badly trailing Biden in the overall money race, defended his fundraising skills Monday evening by declaring he could be the “greatest fundraiser in history” if he called up the head of Wall Street firms and major energy companies and asked them to “do me a favor.”
“So I call some guy, the head of Exxon. I call the head of Exxon, I don’t know, you know. I’ll use a company,” Trump said. “‘Hi, how you doing? How’s energy coming? When are you doing the exploration? Oh, you need a couple of permits, huh? Okay….I’d love you to send me $25 million for the campaign.’”
Trump said he doesn’t want to do that because then he’d become “totally compromised.”
Even though Trump was just mentioning Exxon as an example in his story, the company swiftly denied any such conversation happened.
“We are aware of the President’s statement regarding a hypothetical call with our CEO…and just so we’re all clear, it never happened,” Exxon said in a tweet Monday evening.
The debate over fracking
Biden would represent a sharp change – especially if Democrats also win control of the US Senate.
The Democratic presidential nominee has promised to stand up to polluters, in part by banning new oil and gas drilling on federal lands and requiring aggressive methane emissions limits for new operations. And Biden’s $1.7 trillion climate plan, which would need to get through Congress, entails vast new investments in solar, wind and other forms of clean energy.
Although some leading Democrats and climate activists favor a nationwide ban on fracking, Biden has explicitly opposed outlawing the controversial oil-and-gas drilling technique. (The Trump campaign has misleadingly said otherwise). Banning fracking would kill tens of thousands of oil and gas jobs – including jobs in Pennsylvania, the state that FiveThirtyEight says is most likely to provide the decisive vote in the Electoral College.
“Winning Pennsylvania is the ultimate prize in this election. Those 20 electoral votes could swing the entire election,” said Valliere.
The oil industry isn’t the only one aggressively sending money Trump’s way. The Trump campaign and outside groups aligned with it have raised $38 million from employees of casinos and gambling companies, according to OpenSecrets. That’s well ahead of the $904,000 sent to Biden.
Likewise, Trump has a large lead in the health services industry, which has sent him $38.7 million, compared with just $2.8 million to Biden.
Trump’s lead is slimmer without super PACs
For his part, Biden is well ahead of Trump in terms of raising money from Wall Street. The securities and investment industry has sent him $11.9 million, nearly six times as much as Trump. Individuals at hedge funds and private equity firms have sent Biden $35.4 million, compared with just $6.8 million for Trump, according to OpenSecrets.
In the oil industry, Trump has outraised Biden from individuals at several major companies, including Occidental Petroleum (OXY) and Halliburton (HAL). Surprisingly, however, Biden has outraised Trump from employees at some of the biggest oil companies: ExxonMobil, Chevron (CVX), Royal Dutch Shell (RDSA) and ConocoPhillips (COP), according to OpenSecrets.
It’s also worth noting that Trump’s industry lead could be inflated by sizable donations sent to outside groups allied with the president. There is no limit to how much money individuals can send to super PACs.
Excluding money sent to outside groups, Trump has only raised $2.2 million from the oil industry, compared with $780,000 for Biden, according to OpenSecrets.
“When you enter the super PAC universe, all bets are off because one or two people can make or break the totals,” said Sarah Bryner, research director at the nonpartisan Center for Responsive Politics, which runs OpenSecrets.
Tom Steyer: The market is moving against fossil fuels
The latest fundraising statistics only run through August for contributions made directly to campaigns.
“Biden has raised an absolutely stunning amount of money. He could catch up” in the oil industry, Bryner said.
A chunk of Biden’s campaign war chest comes from people directly opposed to fossil fuels: climate activists.
For instance, billionaire super donor Tom Steyer and his wife Taylor have contributed $55 million to Democrats in the 2020 cycle. That makes them the top contributors to Democrats and third overall, according to OpenSecrets.
“People looked at me 10 years ago like I had two heads when I said it was a mistake to invest in fossil fuels,” Steyer told CNN Business.
Steyer, who focused heavily on the climate crisis during his unsuccessful run for president, cheered the recent success of clean energy companies and promises from major banks to encourage clients to align with the Paris climate accord.
“The market is speaking. The market is basically accepting the idea that we need to move to net zero,” Steyer said.
Energy stocks are the biggest losers of the Trump era
Trump’s relentless support for the oil industry hasn’t paid off for shareholders.
During Trump’s presidency, the energy sector is the worst performing of the entire S&P 500, according to Raymond James, continuing a trend that began before his tenure.
“You have cheerleading from the White House and yet the energy sector has massively underperformed,” said Ed Mills, policy analyst at Raymond James.
Of course, it’s possible oil stocks would have performed even worse if Trump were not in office.
One problem is that Trump’s efforts to cut regulatory red tape have only amplified the oil glut keeping a lid on prices. There is so much crude that US oil prices briefly went negative this spring.
And Trump’s war on regulation is only fueling concern about the climate crisis and the rise of socially-conscious investing – two major forces hurting energy stocks.
Ultimately, Trump’s fundraising prowess from oil and gas may reflect a sense that he will have their backs should the industry’s downturn worsen.
“They may view Trump as the ultimate insurance policy,” said Valliere.
