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Trump upbeat on economy despite tariff setback

Trump upbeat on economy despite tariff setback

Washington, 24 February (Argus) — President Donald Trump, facing curbs on his tariff authority and concerns about his military threats against Iran, stuck to his familiar upbeat take on the US economy and the success of his foreign and trade policy during his State of the Union address on Tuesday. "After just one year, I can say with dignity and pride that we have achieved a transformation like no one has ever seen before, and a turnaround for the ages," Trump told the joint session of Congress. "America is respected again like never before." Trump credited the economic "turnaround" to his tariffs, which he said brought in "hundreds of billions of dollars" after he forced foreign countries to sign trade and investment deals. "Everything was working well," he said. "We were making a lot of money. There was no inflation, tremendous growth." Trump railed against the "disappointing" decision by the US Supreme Court on 20 February to strike down his emergency tariffs, which he said made foreign countries "happy". Trump insisted that the trade deals he negotiated under the threat of the now-invalidated tariffs will remain in place, because, he said, the foreign governments know about "the legal power that I, as president, have to make a new deal that could be far worse for them". At least one of those deals has now stalled, because the European Parliament has paused the ratification of the US-EU deal that involved a promise to scale up US crude and LNG supply to Europe. Trump on Tuesday imposed a new, 10pc tariff on all US imports — with exemptions for energy and some other products — for a period of 150 days to give his administration a chance to reverse engineer some of the tariffs struck down by the Supreme Court. He has threatened to raise those tariffs to 15pc. Trump used the speech to tout his "energy dominance" agenda, which he credits with increasing fossil fuel production and lower energy prices. US crude production increased by 600,000 b/d during his first year in office, Trump said. The actual increase in the past year is closer to 500,000 b/d, according to data from the Energy Information Administration (EIA), which also expects production to decline in 2027. Trump cited gasoline prices as low as $1.99/USG at a handful of retail stations as proof that his policies were working. But consumers faced higher prices for electricity and natural gas over the same period, eating into savings on motor fuel. Natural gas prices at the Henry Hub benchmark rose by more than 60pc last year, and EIA expects those prices will continue to rise, driven by higher demand from LNG exports and data center power demand. Democrats say that Trump's attacks on wind and solar projects, and phase-out of clean energy tax credits, will result in consumers facing far higher prices in the coming years as data center power demand surges. To address concerns about data center-driven price increases, Trump unveiled what he called a "ratepayer protection pledge", under which technology companies seeking to build new data centers can build new, dedicated power plants rather than connect to existing power grids. Data centers developers already have turned to building "behind-the-meter" power plants, which allows them to bypass the complex regulatory process for approving new generation and transmission infrastructure. Iran in Trump's sights Trump during his speech accused Iran of trying to restart its nuclear weapons program, even though he said the bombing raid he ordered in June 2025 "obliterated" that program. Despite ongoing negotiations with Tehran, "we haven't heard those secret words, 'We will never have a nuclear weapon'", Trump said. "My preference is to solve this problem through diplomacy, but one thing is certain, I will never allow the world's number one sponsor of terror, which they are by far, to have a nuclear weapon." The US military buildup in the region near Iran is the largest in decades, but the administration did not brief lawmakers on the possible military options Trump is considering until shortly before his speech. Top Democratic lawmakers, after a classified briefing by secretary of state Marco Rubio on Tuesday, expressed concerns about what Trump is planning to do and urged him to clearly articulate the potential risks of his actions. "It is incumbent upon the president to make the case on what our country's goals are, what our interests are, and how we are going to protect our interests in the region," senator Mark Warner (Virginia), the senior Democrat on the Senate Select Committee on Intelligence, said after the briefing. "Wars in the Middle East don't go well for presidents, for the country, and we have not heard a single good reason for why now is the moment to launch yet another war in the Middle East," representative Jim Himes (Connecticut), the top Democrat on the House intelligence panel, said. By Haik Gugarats and Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.