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Tom Kirkman

What U.S. states are doing for their oil industries: Reuters Factbox

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For info.  Details in the link.  Unlike the OPEC cartel, the U.S. federal government will not mandate country-wide production cuts.

Factbox: What U.S. states are doing for their oil industries

Numerous U.S. states are considering aid for their ailing oil industry, as jobs are disappearing fast and companies have been declaring bankruptcy due to a 30% drop in fuel demand due to the worldwide COVID-19 coronavirus pandemic.

Global oil prices are down by more than two-thirds this year, and prices went negative on April 20. That has hit U.S. production, which rose to a record of nearly 13 million barrels per day in 2019, but is now is expected to fall by at least 2 million bpd by the end of next year.

The federal government has not mandated production cuts, unlike the Organization of the Petroleum Exporting Countries and its allies which have cut output by 9.7 million barrels per day. Several states have authority to mandate production cuts, but none has taken that step.

Texas is the largest producing state in the country, with output of more than 5 million bpd. The state’s oil regulator, the Texas Railroad Commission, has held meetings to vote on whether to mandate production cuts, but put off a vote on the issue until early May.

The commission held production down between the 1930s and 1970s in response to massive oil discoveries that dropped the price of crude to pennies. Since then it has not taken the drastic step of reducing output. Major producers in the state, including Exxon Mobil and Chevron Corp, are opposed to such a move.  ...






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