The Donald Doctrine's core concept is to establish Western Hemisphere energy dominance, consolidate the petrodollar order, and transform the Americas into a controllable energy hinterland for the United States. Leveraging oil and gas production capacity in the US mainland, Venezuela, Suriname, and other countries, it aims to form a supply bloc capable of competing with OPEC in the Middle East. The US uses Western Hemisphere oil resources as a long-term supply ballast, while simultaneously using the Middle East as a complementary geopolitical lever, attempting to control oil routes, reshape global oil pricing power, and strengthen the petrodollar. The underlying slogan supporting this strategy is the classic Republican motto: "Drill, baby, drill." "Drill, baby, drill" advocates for liberalizing fossil fuel extraction and shelving radical green transitions. After Trump took office, he fulfilled his tacit agreement with oil and gas capital: easing EPA environmental restrictions, canceling new fuel efficiency regulations for passenger cars, opening up shale oil and offshore drilling approvals, reducing subsidies for solar and wind power, lowering compliance costs in the oil and gas industry, suppressing the development of new energy sources, and clearing domestic policy obstacles for the Americas' oil strategy.

Western Hemisphere Strategy: Building the Americas' Oil Backyard

After laying the groundwork domestically, the focus shifted to South America, with a particular emphasis on Venezuelan oil and gas development, while simultaneously encouraging increased production in Suriname, Brazil, and Canada. Rystad Energy data shows that total crude oil production in the Americas is projected to grow by 10% over the next two years, while US crude oil and refined product exports are expected to increase by 15%. The strategic intent is twofold: first, to use the increased production in the Americas to continuously weaken OPEC's pricing power, acting as a buffer for oil prices; second, to promote the dollar-denominated settlement of American crude oil, further aligning oil prices with the US dollar. The ideal scenario: the Americas provide a stable supply base, while the Middle East serves as a geopolitical lever that can be actively manipulated.

Middle East game: Attempt to replicate the Venezuelan model suffers a major miscalculation.

Trump's military action against Iran was a complementary operation to this energy strategy, the core idea of which was to replicate the Venezuelan scenario: to destabilize the current Iranian regime through military pressure, support pro-American forces, and allow American capital to take over Iran's oil resources, thus "using oil to fund the war"; simultaneously, to control the Strait of Hormuz, collect protection fees from Gulf states, weaken Iran's regional influence, and consolidate the petrodollar. However, Iran's military industry and anti-blockade capabilities were far superior to Venezuela's, and the plan failed to materialize: regime change did not occur, and Gulf states refused to pay protection fees. Iran subsequently blocked the Strait, and coupled with attacks on oil refining facilities by the Houthis and Ukraine, the supply gap for refined oil products rapidly widened. Brent crude oil rose to $109 per barrel, gasoline prices increased by 40% in a year, and diesel prices approached historical highs.

Short-term realized dividends

High oil prices have brought huge profits to oil and gas companies, with ExxonMobil and Chevron seeing significant increases in profits, and refining margins becoming the main source of these profits. Energy states such as Texas and Oklahoma have benefited, while high crude oil prices have passively increased global demand for US dollars, which is a short-term positive for the petrodollar system.

Costs and tail risks at the transaction level

Inflation is borne by the entire population. Brown University estimates that the average household will incur an additional $1,059 in gasoline and diesel expenses due to the conflict. Inflation persists above wages, dragging down the Republican Party's election prospects. Democrats have proposed a tax on excessive profits from oil and gas, with the proceeds returned to residents, a potential negative policy factor for the oil market. Energy inflation raises stagflation expectations, limiting the Federal Reserve's room for interest rate cuts, pushing up long-term US Treasury yields, and negatively impacting gold. Furthermore, the Strait of Hormuz poses a constant threat of renewed disruption, increasing oil price volatility; meanwhile, the high cost of oil extraction in the Americas cannot fully replace low-cost supplies from the Middle East, limiting its hedging capabilities.

Summarize:

This strategy has achieved some progress in production capacity deployment in the Americas, weakening OPEC's influence and temporarily strengthening the petrodollar. However, it has been severely miscalculated in the Middle East: the goals of replicating Venezuela, controlling Iranian oil, and collecting protection fees have all failed, instead pushing up refined oil inflation. Going forward, we will focus on three main themes: the US windfall profits tax bill, the Federal Reserve's inflation response, and unexpected geopolitical developments in the Taiwan Strait.