(Bloomberg) -- The oil and gas industry, long one of the most reliable sources of campaign cash for Republican candidates at all levels, is turning a cold shoulder to President Donald Trump.
Reeling from the worst oil-price crash on record and wary of Trump at the best of times, energy companies and their employees are donating far less to his re-election campaign than they did to his first run, and also much less than they’ve showered on Republican presidential candidates in the past.
As Trump faces widespread criticism of his handling of the coronavirus pandemic and of the protests over police brutality, the slump in donations from a once-reliable ally is more evidence of a troubled re-election campaign.
Trump raised $1.1 million from oil and gas company employees between May and November in 2016, the only period he actively raised donations during his first presidential run. But in the 40 months since, when he’s relentlessly been raising re-election cash, they’ve given him $654,103.
The reasons vary from slimmer wallets after the oil-price collapse and some of Trump’s rhetoric during Saudi Arabia’s oil price war with Russia, to the Covid-19 lockdown, during which he cheered cheap gasoline as “a tax break for Americans.”
Tillerson’s Treatment
Trump’s tariffs on foreign steel, which affect refinery infrastructure, are also unpopular in the industry -- and for some, so was his treatment of Rex Tillerson, the former chief executive officer of Exxon Mobil Corp., who served as Trump’s first secretary of state but was fired in a tweet and later publicly derided by the president as “dumb as a rock.”
“The culture in the oil business is very traditional: ‘I want to shake your hand, I want to have a meeting face-to-face,’” said Ryan Sitton, a member of the Texas Railroad Commission, the industry’s state regulatory agency. “The president never had the chance to make those connections, beyond shaking hands at a rally, to really sit down and say, ‘I’m Donald Trump, and this is who I am.’ He went from New York real estate mogul to being president.”
Energy-industry executives are quick to point out that Trump -- or any Republican -- is better for their interests than former Vice President Joe Biden and other Democrats. Their efforts to curb climate change by reducing consumption of fossil fuels and the progressives’ “Green New Deal” would be disastrous, they say.
Compliance Costs
They also like Trump’s deregulation policies, which have cut the industry’s compliance costs, and the 2017 Republican tax law, said Kevin Book, managing director at ClearView Energy Partners, a Washington-based research firm.
But that may not be enough. Some in the industry say Trump failed to respond adequately to the Covid-19 pandemic, which caused gasoline prices to plummet as stay-at-home orders kept people off the roads, said Dan Eberhart, chief executive officer of Denver-based Canary Drilling Services and a fundraiser for Trump and other Republicans.
“With the Covid-19 situation, the Trump administration has said all the right things but not done anything,” Eberhart said. Among steps the president could have considered were temporary tariffs on imported oil, which could have been imposed on Trump’s own authority, larger Strategic Petroleum Reserve purchases and emergency lending for oil and gas companies, which would have required congressional action, Eberhart said.
Trump doesn’t need the oil industry’s cash to compete with Biden. He’s raised $742 million in the last 16 months, more than twice the money that Biden and the DNC raised through April. But he could use the industry’s support to help lobby for further deregulatory actions and fighting green policies, were he to win a second term.
Saudi Success
Trump got high marks for successfully talking Saudi Arabia into agreeing to production cuts that have prices rising, said an industry insider who’s a major fundraiser for presidential campaigns, but who asked not to be named. Yet there are too many other issues on which he differs from Trump to raise money for him, the insider said, and he’s refused Republicans’ requests to do so.
Previous Republican presidential candidates have enjoyed the energy industry’s largesse.
In 2012, GOP nominee Mitt Romney raised $6.9 million from the industry. And by the end of April in their election years, 2008 nominee John McCain had raised $1 million and President George W. Bush, a former Texas oilman, had received $2.5 million for his re-election.
Those who backed Trump’s rivals in the 2016 Republican primary have been slow to back Trump or the super PACs that support him, according to Federal Election Commission filings that are current through April.
Those who backed Trump’s rivals in the 2016 Republican primary have been slow to back Trump or the super PACs that support him, Federal Election Commission records show.
Kelcy Warren, CEO of pipeline firm Energy Transfer Partners, who gave $5 million to a super PAC backing former Texas Governor Rick Perry, contributed $360,600 to Trump Victory in 2019. And in 2015, Kinder Morgan Inc. Executive Chairman Richard Kinder and his wife, Nancy, each gave $1 million to Jeb Bush’s super PAC, Right to Rise -- but they haven’t donated to Trump.
Down-Ballot Focus
Spokesmen for Warren and Kinder both declined to comment.
Others are supporting Trump relatively modestly while giving more to committees focused on down-ballot races. Occidental Petroleum Chairman Stephen Chazen, who gave $1.6 million to congressionally focused GOP super PACs in the 2018 midterms, has given $700,000 in the current cycle to Republican groups focusing on congressional elections. Chazen gave $175,000 to Trump Victory in 2019.
Chazen declined to comment through Occidental spokeswoman Melissa Schoeb.
Farris and Dan Wilks, brothers and founders of a Texas fracking company they sold in 2011 for $3.5 billion, with their spouses gave $15 million to a super PAC that supported Ted Cruz in 2016. The family has given $300,000 to Trump Victory. Farris Wilks has also given $200,000 to Club for Growth Action, a pro-business super PAC that supports congressional Republicans and has criticized Trump’s trade policies. The Wilkses didn’t return messages seeking comment.
Bad Timing
Republican fundraisers say they’re counting on billionaire Harold Hamm, chairman of Oklahoma City-based Continental Resources Inc., who advises Trump on energy policy, to give more than the almost $1 million he put into Romney’s super PAC in 2012. But through April, the most recent numbers available, Hamm, whose net worth has been battered by the crude-price collapse, has given just $50,000 to Trump Victory.
Spokeswoman Kristin Thomas didn’t respond to a request to make Hamm available.
“While things were very good until two or three months ago, they’re very bad now,” said Matt Mackowiak, a Texas-based Republican political consultant. “It may be harder to write a big check now.”
Some say the relationship is improving, thanks to Trump’s intervention with the Saudi royal family, a White House meeting for energy executives and the curbing of new regulations, said Christi Craddick, a member of the Texas Railroad Commission.
“We were, as an agency, watching 147 regulations and rules that had been passed under the previous administration,” Craddick said. “From a business perspective, if you add a rule or regulation, that costs a lot of people a lot of money. That all went away when this administration came into office.”
Still, the ongoing struggles of industry leaders who have been forced to cease operations in Texas’ energy-rich Permian Basin and lay off thousands of employees may be curbing their willingness to write big checks.
“This is a very challenging time for every Texan, but especially those who find their living in the Permian basin,” said Jeff Moseley, president and CEO of the Texas Association of Business. “It’s just hard to find that extra money to put into campaigns.”
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