Cutting government waste, fraud, and abuse is a familiar political refrain, but since taking office, President Donald Trump has taken efforts to cut government spending to new levels. On the first day of his presidency, the Trump administration established the Department of Government Efficiency (DOGE) to “bring accountability and transparency to federal spending, ensuring taxpayer dollars are spent wisely and effectively.” Under this goal, DOGE has cancelled contracts and grants, cut thousands of federal jobs, and clawed back regulations in an effort to save the government money, resulting in reduced access to public services.
Yet DOGE has failed to address a major area of government waste and inefficiency: the federal oil and gas program. In fact, rather than cutting down on waste, the administration has increased opportunities for the industry to profit—even through potentially corrupt and illegal means—at the expense of everyday people.
Fossil fuels are a known long-standing source of government waste
The federal oil and gas program has long been a breeding ground for waste, fraud, abuse, and mismanagement. The “High-Risk Series,” a list put out by the Government Accountability Office (GAO) every two years, highlights areas across the federal government that are “seriously vulnerable to waste, fraud, abuse, and mismanagement or that are in need of transformation.” Management of federal oil and gas resources has made the list for the past 14 years, and for good reason: By the government’s own analysis, U.S. taxpayers are losing out on $730 million in revenue from oil and gas every year. GAO’s reports explain that there is no reasonable assurance that the Bureau of Land Management (BLM)—the agency responsible for the federal oil and gas program—is collecting the full amount that companies owe on its oil and gas leases.
The Trump administration is not just failing to address the inefficiencies flagged by the GAO; it is actually magnifying waste, fraud, and abuse through a variety of rollbacks and regulations and squandering millions of taxpayer dollars as a result. In the seven months since Trump took office, the administration has taken at least a dozen actions that ignore or heighten waste, inefficiency, speculation, and abuse in the oil and gas sector.
Ignoring oil and gas industry corruption and conflict
- Collusion: In two separate merger deals between oil and gas companies—the acquisition of Pioneer by Exxon Mobil and of Hess by Chevron—the Federal Trade Commission (FTC) issued complaints regarding antitrust concerns and attempted collusion between executives and foreign oil producers. The CEOs of Pioneer and Hess had both sought to coordinate and alter production levels with these producers, including OPEC representatives, in order to inflate prices and increase profits. In January 2025, the FTC issued consent orders barring both CEOs from joining the boards of their respective newly merged companies. But five months later, the FTC under the Trump administration reopened and vacated the previous orders. John Hess, former Hess CEO, has since joined the Chevron board despite the previous allegations of his attempts to keep prices high.
- Potential conflicts of interest: DOGE put Tyler Hassen, a former oil executive with 20 years of industry experience, in charge of sweeping reforms to the U.S. Department of the Interior. Hassen, whose role is not subject to congressional approval despite being granted broad power to reorganize the agency, assumed the position without divesting energy investments or filing an ethics commitment to break ties with companies that may pose a conflict of interest.
Americans need to look no further than the Trump administration’s own actions for proof of this waste. The deregulation of and favoritism for the oil and gas industry will cost the United States billions.
Increasing financial waste from oil and gas lease sales by scaling up industry handouts and shifting costs and risk onto taxpayers
- Royalty rates: Federal royalty rates, or the percentage of profits from production on national public lands that oil and gas companies pay to the federal government, have sat below market rates for years. The GAO’s 2025 High-Risk report recommended raising royalty rates as a strategy to reduce waste, and an analysis from the Congressional Budget Office noted that raising rates by 6 percent could generate $200 million, and impacts to company production would be “negligible.” Yet instead, the Trump administration, through the Big “Beautiful” Bill (BBB), just lowered the royalty rate back to 12 percent, undoing a 2022 increase of 4 percent and widening the gap of federal losses from oil and gas production.
- Noncompetitive leasing. The BBB also reinstated the practice of noncompetitive leasing. Under noncompetitive leasing, land parcels that do not receive bids at auction are relisted the following day on a first-come, first-serve basis with no bonus bid required. Enabling companies to bypass market competition through this loophole results in massive taxpayer losses: Onshore noncompetitive leases generate five times less revenue compared with competitive leases.
- Speculation: The BBB also got rid of the modest, first-of-its-kind fee on nominating public lands for leasing. The fee helps discourage wasteful speculation by ensuring that companies are only nominating lands on which they intend to bid. Otherwise, putting lands up for auction that do not receive any bids wastes already-scarce BLM resources. Prior to the fee, BLM’s wasteful lease auctions resulted in very few actual sales. In one 2018 auction, for example, the Department of the Interior offered 300,000 acres of federal land and received zero bids. In 2021, the GAO specifically recommended instating a nomination fee to reduce waste.
- Financial assurances: The Department of the Interior is revising the offshore financial assurances rule, which requires energy companies that hold offshore leases to provide bonds or other guarantees in order to ensure that the companies will bear the costs of compliance and cleanup, including decommissioning offshore wells. The department’s revisions will transfer the costs and risks of oil and gas drilling away from industry and onto the federal government and taxpayers.
- Onshore bonding requirements: The Department of the Interior is moving to gut a recent increase in bonding requirements. Bonds are required for oil and gas companies operating on public lands to ensure that there is money set aside for cleanup so that the high costs of plugging wells does not fall to taxpayers and local communities. A 2024 rule aimed to address the gap between the requirements (as low as $10,000) and actual reclamation and cleanup costs (in some cases, millions of dollars) by raising bond rates. Now, Secretary of the Interior Doug Burgum plans to revert the bonding requirement back to insufficient rates.
- Reoffering unwanted leases: The Trump administration’s BLM is wasting limited staff time to reauction numerous oil and gas leases that have previously been offered without bid. For example, in April, BLM relisted 11 parcels that had been offered and received no bids in September 2023—and once again, none of the parcels sold.
Disempowering oversight and accountability mechanisms
- Firing commissioners: President Trump fired two of the five commissioners of the Federal Trade Commission, an independent regulator responsible for protecting the public from deceptive or unfair business practices, including within the oil and gas sector. Gutting the commission has the potential to empower industry corruption by weakening the commission’s power to exert independent oversight.
- Shuttering oversight offices: DOGE shut down two regional offices responsible for oversight of offshore drilling, including conducting inspections of drilling rigs and platforms, enforcing standards and regulations, and environmental compliance. The offices, located in Louisiana and California, collectively oversaw more than 97 percent of all U.S. oil and gas production.
- Laying off the compliance workforce. The Trump administration has cut more than 11 percent of the Department of the Interior’s staff, significantly affecting the department’s ability to enforce compliance with rules and regulations that act as safeguards for public health and the environment. The government specifically flagged compliance activities for the oil and gas industry as an opportunity to reduce waste, as these activities generated $600 million from 2012 to 2022, but compliance will likely be hindered by recent layoffs.
- Diluting enforcement power. The U.S. Environmental Protection Agency no longer has the power to take enforcement action that would shut down any stage of energy production “unless there is an imminent and substantial threat to human health or an explicit statutory or regulatory requirement,” a high bar that could threaten both people and the environment. These protections for energy production demonstrate the Trump administration’s prioritization of industry interests over human and environmental health.
Conclusion
The oil and gas industry has long been a source of mismanagement and massive amounts of waste. Rather than increasing efficiency and reducing the federal deficit, the Trump administration is empowering even more abuse and corruption within the industry and the department that oversees it. In Trump’s own words, “The American people have a right to see how the Federal Government has wasted their hard-earned wages.” Americans need to look no further than the Trump administration’s own actions for proof of this waste. The deregulation of and favoritism for the oil and gas industry will cost the United States billions.
The authors would like to thank Nicole Gentile, Margaret Cooney, Mona Alsaidi, Mariel Lutz, and Christian Rodriguez for their contributions to this column.