Supreme Court Strikes Down Trump Tariffs, Energy Companies May See Cost Relief

The Supreme Court's decision to eliminate certain Trump-era trade tariffs could reduce expenses for oil and gas companies that rely on foreign-made equipment. However, energy experts say the ruling won't significantly change global energy trading patterns.

Energy companies across the nation may see some financial relief following the Supreme Court’s Friday ruling that eliminated several trade tariffs implemented during the Trump administration, though industry experts caution that global energy markets will likely remain largely unaffected.

The court’s decision stands to benefit oil producers and drilling companies by lowering costs associated with foreign-manufactured equipment and components that were subject to the tariffs. Companies involved in building liquefied natural gas facilities and other major energy projects could particularly benefit, as these operations often depend on specialized modules and parts produced overseas.

One example includes Venture Global, which constructs LNG facility components in Italy before shipping them to the United States for final installation. The previous tariff structure had increased operational expenses throughout the energy sector’s supply chain, forcing many companies to either absorb higher costs or attempt to transfer them to their clients.

Cam Hewell, who serves as president and CEO of Premium Oilfield Technologies, expressed optimism about the financial impact. “We were forecasting that we would have to pay around $5 to $6 million in tariff taxes in 2026, so that number will come down, hopefully,” Hewell explained.

The executive noted that his company had absorbed most of the tariff burden rather than passing it to customers. “We had to eat about 90% of the tax increase, so it won’t have a big impact on what we charge customers. But it will free up more cash flow for research and development, employee raises, and cash back to investors,” he added.

Kirk Edwards, president of Texas-based Latigo Petroleum, suggested the ruling would help energy companies develop more accurate budgets and better calculate drilling expenses.

However, the Supreme Court’s action did not affect the 50% tariffs on steel and aluminum that were also implemented previously. Some industry leaders worry the current administration might find alternative methods to maintain similar cost burdens.

Hewell voiced these concerns, stating: “I have some fear that the administration will quickly bypass Congress and cook up another tariff scheme that mimics the current one…and never change the amounts we have to pay.”

President Trump has indicated he may pursue other tariff options, suggesting a 10% worldwide tariff lasting 150 days. “We have alternatives, great alternatives,” Trump said.

Despite the potential construction cost savings for LNG facilities, energy analysts don’t expect major changes in international gas trading patterns. Ira Joseph, a senior research associate at Columbia University’s Center on Global Energy Policy, explained that economic factors will likely keep Chinese LNG purchasing patterns unchanged.

“It makes more sense for China to continue to trade on U.S. LNG to Europe to make an arbitrage on the shipments or import cheaper oil-indexed LNG from the Middle East,” Joseph said.

Alex Munton, who directs global gas and LNG research at Rapidan Energy consulting firm, emphasized that geopolitical considerations remain paramount. “Beijing now treats its LNG market as strategic leverage with the U.S., and no LNG purchases were agreed as part of the deal late last year. Beijing is unlikely to offer purchases or make concessions, even if tariffs now ease,” Munton explained.

Samantha Santa Maria-Hartke, head of market analysis at Vortexa, noted the administration’s determination to pursue its policy objectives. “If this administration has proven anything, it’s that it is extremely resourceful in trying to get its agenda accomplished, they will look for alternative options,” she said.

China had ceased importing U.S. crude oil and LNG after implementing its own counter-tariffs, and Santa Maria-Hartke indicated this policy would likely continue regardless of the Supreme Court’s decision.