task0778
Diamond Member
The latest quarterly survey put out by the Federal Reserve Bank of Dallas shows that most executives are reticent about ramping up drilling because of pressure from investors and lenders, not from government regulations. That said, in anonymous comment sections of the survey, the executives laid into Biden and other officials for getting in the industry’s way.
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When asked why they aren’t raising production more, 59% of respondents said it was because investors are pressuring them to maintain capital discipline. Another 11% said it was because of the environmental social and governance movement, 8% said it was because of trouble accessing financing and 6% said it was because of government regulations. Another 15% marked “other,” which included things like “personnel shortages, limited availability of equipment, and supply-chain issues.”
“The industry is facing serious supply issues for the materials needed to grow production,” wrote one production executive in the comments section.
In addition, the Fed asked producers what price of West Texas Intermediate oil it would take for them to get back into “growth mode.” For 41%, they said they needed prices to be $80 to $99 a barrel, a level that WTI has already surpassed. But the second-most respondents—29%—said the price didn’t matter. That implies that they are sticking to their production plans no matter what, a departure from past oil booms.
Even if other factors are causing slow growth, several executives said in the comments section of the survey that political pressure—from the federal or state government—was hurting the industry.
“In the first quarter of 2021, I divested all properties in the state of Colorado due to the unbelievably hostile and increasingly aggressive regulatory environment driven by anti-fossil-fuel ideology,” said one oil producer. “The administration has no clue about the oil-and-gas industry,” an oil services executive said.
www.barrons.com
The Biden Administration has made no secret of their desire to put the Oil & Gas industry out of business, and they have not been shy about doing whatever they can to make it more difficult to produce more oil and LNG. Even now, the Biden would rather buy foreign oil from people who are less constrained by environmental concerns and also release oil reserves that are supposed to be only for national emergencies.
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.
When asked why they aren’t raising production more, 59% of respondents said it was because investors are pressuring them to maintain capital discipline. Another 11% said it was because of the environmental social and governance movement, 8% said it was because of trouble accessing financing and 6% said it was because of government regulations. Another 15% marked “other,” which included things like “personnel shortages, limited availability of equipment, and supply-chain issues.”
“The industry is facing serious supply issues for the materials needed to grow production,” wrote one production executive in the comments section.
In addition, the Fed asked producers what price of West Texas Intermediate oil it would take for them to get back into “growth mode.” For 41%, they said they needed prices to be $80 to $99 a barrel, a level that WTI has already surpassed. But the second-most respondents—29%—said the price didn’t matter. That implies that they are sticking to their production plans no matter what, a departure from past oil booms.
Even if other factors are causing slow growth, several executives said in the comments section of the survey that political pressure—from the federal or state government—was hurting the industry.
“In the first quarter of 2021, I divested all properties in the state of Colorado due to the unbelievably hostile and increasingly aggressive regulatory environment driven by anti-fossil-fuel ideology,” said one oil producer. “The administration has no clue about the oil-and-gas industry,” an oil services executive said.
Texas Survey Shows Why Oil Producers Aren't Drilling More
Some 59% of the energy firms that responded said investors were pressuring them to maintain capital discipline.
www.barrons.com
The Biden Administration has made no secret of their desire to put the Oil & Gas industry out of business, and they have not been shy about doing whatever they can to make it more difficult to produce more oil and LNG. Even now, the Biden would rather buy foreign oil from people who are less constrained by environmental concerns and also release oil reserves that are supposed to be only for national emergencies.
