On the first day of his second term, President Donald Trump declared that the United States was experiencing a “national energy emergency.” The “harmful and shortsighted policies of the previous administration,” he wrote in an executive order, had left the nation’s energy resources “far too inadequate,” a situation that “causes and makes worse the high energy prices that devastate Americans.” Since then, Trump has attempted to use the emergency declaration to speed up permits for fossil fuel development and bolster the nation’s power grid with more fossil fuel resources.
Almost two years later, as Trump stares down a midterm election, his claim of an emergency has an ironic ring. The United States is experiencing a kind of energy emergency characterized by high fuel prices, but it is not the one he described when he took office. Not only that, but the executive powers he unlocked with his emergency order have proven useless for mitigating the current crisis and for lowering the high prices he decried upon taking office.
“The genesis of the problem is the war in Iran,” said Gbenga Ajilore, the chief economist at the Center on Budget and Policy Priorities, a nonpartisan economic think tank, who has analyzed Trump’s energy policy. Trump’s attack on the country has led to the closure of the Strait of Hormuz and the destruction of refineries and oil fields, which has reduced the global supply of refined fuels like gasoline and diesel. The supply crunch for these refined fuels has been even worse than for crude oil, and has hit wallets harder.
This irony points to a hard truth about how the fossil fuel system works. Even with all the powers available to the executive branch, Trump has not been able to tamp down prices either for petroleum fuels or for electricity. He has been able to muscle through specific oil projects and keep certain power plants open, but the markets for oil and power are so large and complex that these interventions have made no difference in consumer prices. Whether these high prices constitute an emergency or not, there isn’t much he can do about it — short of ending the war in Iran.
“If you reverse that, it may not drop like a rock, but it’s going to start going down,” said Ajilore. “Outside of that, there really isn’t much to do.”
Electricity: Keeping coal plants running
The practical impacts of Trump’s energy emergency declaration have affected two key parts of the energy system, the areas where the president had the biggest disagreements with the Biden administration. The first was the power grid, where former president Joe Biden sought to deploy large new amounts of solar and wind power even as data centers drove up electricity demand. Trump promised on the campaign trail that he would cut energy bills in half, and he directed federal agencies to “identify and exercise any lawful emergency authorities available to them” to facilitate power generation.
The Energy Department took the order and ran with it. Secretary Chris Wright, a noted champion of fossil fuels, has issued several emergency orders to prevent the scheduled retirement of coal plants around the country. The secretary argued in these orders that strained grid conditions made it necessary to preserve all available power capacity, even though the utilities that ran the plants were trying to shut them down.
Instead of reducing energy prices, these orders have come at significant costs. In Michigan, keeping the J.H. Campbell plant open has cost ratepayers in the Midwest almost $300 million on net, even though the plant is generating far less power than it did before the order. In Colorado, a utility has had to continue operating a coal plant it was about to retire even though the plant is broken and needs serious maintenance. In many cases, the retiring plants were among the oldest and least efficient facilities in their region, so keeping them on doesn’t save consumers money even if they do add power to the grid.
It took a while, but the courts have started to question these interventions. In September, after Michigan sued over the coal plant mandate at Campbell, an appellate court blocked the Department of Energy’s order, rejecting the administration’s reading of federal law. The judge in the case also took issue with the administration’s claims of an energy emergency in the region’s grid, writing that Wright’s assertion of an emergency was “unpersuasive” and that his policy “invites frequent federal interventions that … threaten the stability of the energy market.”
“We saw in the Michigan case that the facts just don’t match up with the claims and with the law, and I suspect that in some of these other cases, if not all of them, we’ll see similar decisions,” said Melissa Birchard, the mitigation program director at the Georgetown Climate Center, a research institute based at Georgetown Law School. The state’s utility commission and the regional grid operator both rejected the idea that there was an energy shortage in the region around the Campbell plant.
Crude oil: Drill, baby, drill
The other area where the administration used the emergency declaration to reverse Biden-era policy was in the oil and gas sector. Here, too, there was no critical shortage, as U.S. oil and natural gas production were both near all-time highs. While Biden approved some large drilling projects such as the Willow effort in Alaska, he attempted to block oil leases in the Gulf of Mexico and canceled the Keystone XL oil pipeline. Trump’s executive order attempts to steamroll the environmental and procedural permits that have slowed down energy development in the past — the order directs agencies to use “all relevant lawful emergency and other authorities” to “expedite” the construction of oil wells, pipelines, and other energy facilities. It also seeks to waive the Clean Water Act and the Endangered Species Act wherever possible.
The order has produced a few notable wins for the fossil fuel industry. Earlier this year the Trump administration convened what is known as the “God Squad,” a committee of Cabinet secretaries with the power to override the Endangered Species Act. In a meeting that lasted only a few minutes, the committee waived all species protections for oil and gas drilling in the Gulf of Mexico, a measure that will enable BP to pursue a deepwater rig project known as Kaskida.
The order also directed the U.S. Army Corps of Engineers to speed through permitting for pipelines and other infrastructure under the Clean Water Act, and the Corps last year identified a list of around 600 projects eligible for fast-tracking. It later withdrew that list, but some projects on its permitting database are still tagged with “energy emergency,” such as Enbridge’s Line 5 oil pipeline replacement, a mineral sands mine owned by Chemours, and a natural gas pipeline in Florida. It’s unclear whether and when these projects would have moved forward absent the order, but expediting them won’t do anything to bring down the high prices Trump mentioned in his emergency declaration. The largest of them, Kaskida, is years away from producing oil, and would only produce a small fraction of the oil that moves through the Strait of Hormuz in a normal month.
In addition to Michigan’s Campbell lawsuit, around a dozen states have sued the Trump administration over his original executive order, arguing that there is no energy emergency in the United States. The oral argument in that case is scheduled for October 20, and Birchard expects that the courts will view the “emergency” declaration with the same skepticism as in the Campbell case.
“We see this accumulated effort to declare emergencies,” Birchard said. The question is “whether the courts are going to start saying, ‘Hey, one emergency we might have believed, two emergencies we might’ve believed, but now we’re seeing a pattern of many, many emergencies. How do we set up, you know, a set of facts that really supports that many emergencies?”
Refineries: The weak link
Meanwhile, a separate crisis has unfolded in a segment of the energy system where Trump’s order has had almost no effect. The United States and the rest of the world are experiencing a shortage of refined fuels like gasoline and diesel, which has driven up prices not only at the gas pump but also for major goods that are hauled on diesel trucks. The price of gasoline remains well above $4 a gallon, and the price of diesel is at an historic high of over $6 a gallon. The so-called “crack spread,” or difference in price between refined and crude oil, reached a multi-year high over the summer as well.
The primary cause of this shortage is the war in Iran, which has closed the Strait of Hormuz and destroyed numerous Middle Eastern refineries, but Ukraine’s attacks on Russia have also destroyed several oil refineries. The flow of crude oil through the Strait of Hormuz has recovered over the eight months of the war thanks in part to American military escorts for tankers, and countries like Saudi Arabia have also managed to export their oil through other channels, which has prevented a global crude shortage. The problem is that consumers don’t buy crude oil. They buy gasoline and diesel, products that are produced at massive refineries.
There is little Trump can do to mitigate this rise in prices. Refineries in the U.S. are already operating at maximum capacity to take advantage of high profit margins, and many large refineries have delayed scheduled maintenance so they can keep producing as much fuel as possible while high prices last.
“Refiners are running close to flat out,” said Abhi Rajendran, the head of research at Energy Intelligence, a firm that analyzes developments in the oil and gas sector. “They’re making money, but there’s not really any kind of slack to ramp things up.”
The only solution to high prices would be to produce more gasoline and diesel, but the refinery system isn’t flexible enough to do that. There are only a few dozen major refineries in the country, as opposed to many thousands of oil wells, and each refinery can only produce so much before it needs maintenance. Refineries cost many billions of dollars to build, they break or shut down all the time, and companies like Marathon and Chevron see no reason to construct new ones in the United States. Overall demand for refined products has declined over the past few years as cars grow more fuel-efficient and consumers embrace electric vehicles.
“Refined product demand has actually been in decline for a long time,” said Rajendran. “In normal times, [refinery capacity] is more than adequate. There’s no real economic case for new refineries, because if these wars end, then it’s just wasted money.”
Trump’s original executive order mentions refining, but it did not do anything to expand refinery capacity, which has left the president with few good options. He considered a diesel export ban, which would prevent companies from selling American diesel overseas, but backed off after opposition from the oil and gas industry. In any case, it would only have caused a marginal decrease in prices, and might have caused prices to rise further as refiners cut back their production.
The president’s other efforts, like buying Russian diesel and encouraging states to expand diesel subsidies, will likely have an even smaller impact. The total amount of diesel that Russia has promised to deliver “immediately” as part of Trump’s recent deal is equivalent to less than one day of U.S. diesel consumption.
The upshot is that absent a breakthrough in Iran, high fuel prices will likely last through the year. While the states that sued Trump over the emergency order argue that steep energy prices themselves don’t constitute an emergency, it seems clear that many Americans feel strained by their gasoline and power bills. A recent Fox News poll found that more than 8 in ten Americans are concerned about gas prices, while the University of Michigan’s consumer sentiment index fell this summer to its lowest level on record. Another recent poll, from the Associated Press, found that two-thirds of Americans blame Trump for high costs, while only one-third blamed “factors outside Trump’s control.”
This story was originally published by Grist with the headline Trump vowed to stop an ‘energy emergency.’ Then he created a real one. on Oct 20, 2026.