President Trump’s administration has rescinded an Obama-era policy that expanded federal oversight and the threat of steep fines for polluting the country’s smaller waterways, furthering his deregulatory efforts in the 14 months that remain before the next election.

Environmental Protection Agency Administrator Andrew Wheeler on Thursday signed a final rule that limits the scope of federal clean-water regulations in an effort to clear up confusion for landowners whose property sits near water sources that feed into the country’s...