In the oil patch, TWO factors happened this year: COVID and OPEC+.
Although the latter's actions, of Saudi Arabia and Russia losing trust in each other, and both wanting to bury American frackers, of "opening the spigots," did technically happen after the start of coronavirus in China was driving oil prices a bit lower, it was largely independent of that.
And, although they partially pulled back, and partially in response to a Trump request, those days are over, too.
So are the days that hinted that American drillers, especially frackers, would learn from this. (Have they ever in the past?)
Oil production has started inching up again in Texas.
Even as WTI prices fell back below $40/bbl.
Are the two correlated? Most likely.
The increased production is probably not the only thing driving the price slip, or maybe, to put it another way, it by itself has not caused the degree of the price slip. But, it's a factor.
Wayne "God loves free markets and Andrews Texas" Christian, head of the Railroad Commission, dissed going back to its 1930s production control roots this summer, saying North Dakota and others wouldn't play along.
Left unspoken? Christian not asking for federal, nationwide production controls. Now, that said, between the PPP and elsewhere, lots of oil people both big and small got government prop-up money. But, once again, the lack of a national energy policy was the bottom line. The Federal Energy DE-Regulatory Commission continues to to just that.
Meanwhile, as readers of this blog, DeSmog Blog and elsewhere know, frackers have a lot of money on the books to Wall Street banks, a lot of it coming due within nine months or so. So, they're looking for any angle possible.
What they really should be looking for is a bigger sucker to buy them out.
Of course, since they're getting We the People to pay for their abandoned well clean-up, they're probably hoping for more PPP-like help from suckers of both duopoly parties in DC. That DeSmog Blog link refers to their loans on the books, and self-bonding on well cleanup, among other things.
Specific to fracking, it notes that more wells, deeper wells, and shorter-lived wells (any regular reader here knows that I've written before about how part of the reality behind the fracking hype is a short-term production spike that then quickly declines again) means more orphan wells.
Also per that link, the real problem isn't suckers in DC claiming to represent We the People. It's suckers (or willing sellouts) like Wayne Christian in Austin, and counterparts in places like Denver and Santa Fe. If frackers can dump old wells on state agencies, they will. Period.
Remember that when your neighbor bitches about cleanup after abandoned wind turbines. Especially if they have a gas lease.
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