Sen. Thom Tillis (R-NC), facing a tight re-election race, said President Trump is expanding his recent offshore drilling ban to include the coast of his state, Axios reports.
President Trump announced a 10-year ban on oil drilling off the coasts of Florida, Georgia and South Carolina — in a political reversal likely meant to help shore up his support in swing states, Politico reports.
Said one energy industry official: “It’s a complete ambush. Nobody knows where this came from. It totally seems like a campaign sort of thing.”
“The Trump administration is set to open the Arctic National Wildlife Refuge in Alaska to oil drilling for the first time, making it difficult to unwind the decision should Democrats recapture the White House in November,” the Wall Street Journal reports.
“The Trump administration is preparing to open the door to oil and gas drilling off Florida’s coast — but will wait until after the November election to avoid blowback in a swing state whose waters both parties have long considered sacrosanct,” Politico reports.
“Drilling in the eastern Gulf of Mexico would fulfill a long-sought goal of energy companies… But even the possibility of drilling is a politically explosive topic for Floridians, who worry that oil spills would devastate their tourism-based economy in a reprise of the 2010 Deepwater Horizon disaster.”
Wall Street Journal: “Oil prices slid further on Tuesday, signaling a bleak outlook for energy demand even as more countries move to restart their economies during the coronavirus pandemic. U.S. crude futures for delivery in June fell 17% to $10.65 a barrel, a day after the U.S. oil price benchmark tumbled 25%.”
Financial Times: “Analysts said the gains were due in part to U.S. president Trump ordering American warships to attack any Iranian vessels that posed a threat. Mr Trump said in a tweet on Wednesday that he had ‘instructed the United States Navy to shoot down and destroy any and all Iranian gunboats if they harass our ships at sea.’”
Matt Levine: “In ordinary economics, things do not have negative prices: If nobody wants a thing, if you’d have to pay them to take the thing, you just don’t make it. Oil is a little weird—it is hard to shut in and then restart an oil well, and there are all sorts of weird cartels and game theory involved in oil pricing and production—but the other thing going on here is that a global pandemic is pretty weird for commodity prices. The price of oil is not approaching zero because nobody needs oil; you can look into the future—or at futures prices—and see that, in fact, there is demand for oil.”
“But right now, with the world economy closed, people need much less oil than they’ve got. If you have a thing that lots of people want, but that no one wants right now, it is hard to put a normal price on it.”
President Trump said he may push for a bailout of the oil and gas industry as prices continued to crash.
Said Trump: “We will never let the great U.S. Oil & Gas Industry down. I have instructed the Secretary of Energy and Secretary of the Treasury to formulate a plan which will make funds available so that these very important companies and jobs will be secured long into the future!”
Wall Street Journal: “The convulsions in oil markets underlined the huge hit that government-imposed lockdowns designed to stall the spread of the coronavirus have dealt to oil demand. With producers unable to shut wells fast enough, and OPEC and G-20 production cuts not due to take effect until early May, traders say that the world is essentially running out of space to store oil.”
“The price for a barrel of West Texas Intermediate crude to be delivered next month plunged 93% to $1.21 in Monday’s trading, the lowest price since the futures contract was launched in 1983. If that barrel were to be delivered to a buyer in November, it would be worth more than twenty five times as much,” the Wall Street Journal reports.
“The unusually large difference in price between oil now and then has traders filling up tankers and setting them adrift. The bet is that the coronavirus pandemic runs its course and later this year demand for oil—and thus its price—will jump.”
Financial Times: “As markets opened in Europe on Monday, West Texas Intermediate — the U.S. oil benchmark — was down 17.9 per cent at $14.99 a barrel, its lowest level since 1999. It had fallen as low as $14.47 in Asian trade.”
Fargo, North Dakota is so awash in gasoline, the fuel last week sold for a record 12 cents a gallon at the rack — its last stop before the pump, Bloomberg reports.
“In better times, the price dip would be a boon for gas station owners looking to snag low-cost supplies. But with fewer customers every day, gas pumps are becoming little more than makeshift storage for ballooning inventories.”
“Saudi Arabia and Russia ended their oil price war on Sunday by finalizing a deal to make the biggest oil production cuts in history, following pressure from US President Donald Trump to support an energy sector ravaged by the coronavirus pandemic,” the Financial Times reports.
New York Times: “It was unclear, however, whether the cuts would be enough to bolster prices. Before the coronavirus crisis, 100 million barrels of oil each day fueled global commerce, but demand is down about 35 percent. While significant, the cuts agreed to on Sunday still fall far short of what is needed to bring oil production in line with demand.”
President Trump on Twitter:
“Just spoke to my friend MBS (Crown Prince) of Saudi Arabia, who spoke with President Putin of Russia, & I expect & hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the oil & gas industry!”
Restricting supply will increase prices for consumers.
Just yesterday, Trump celebrated the decline in gas prices as like a massive tax cut: “Now, gasoline’s gonna be 99 cents a gallon and less, you know that. That’s already starting, it’s popping up — 99 cents. So that’s like giving a massive tax cut to people of our country.”
“Global oil consumption is in free-fall, heading for the biggest annual contraction in history, as more countries introduce unprecedented measures to fight the coronavirus pandemic,” the Los Angeles Times reports.
“Travel bans, work-from-home policies, canceled vacations and disrupted supply chains all mean reduced demand for fuel. As societies respond to the virus, oil demand — already hammered by China’s decision to shut down swaths of the economy — is falling further.”
“The White House is strongly considering pushing federal assistance for oil and natural gas producers hit by plummeting oil prices amid the coronavirus outbreak, as industry officials close to the administration clamor for help,” the Washington Post reports.
“White House officials are alarmed at the prospect that numerous shale companies, many of them deep in debt, could be driven out of business if the downturn in oil prices turns into a prolonged crisis for the industry.”
Former Trump appointee Mandy Gunasekara writes in the Palm Beach Post that the myth about “coal in the stocking” of a bad children is just propaganda from the renewable fuels industry.
“Santa understands the vital role coal has and will continue to play in human flourishing. Accordingly, he has called for coal-shaming to end and in an effort to start this trend, he will be leaving a lump of ‘beautiful, clean coal’ in the president’s stocking. Regardless of their naughty or nice status, all little boys and all little girls deserve a brighter, healthier and more prosperous future and the path for that starts with a reliable, safe and clean source of energy.”
Associated Press: “The Associated Press reported some details in October of the brash pitch that Lev Parnas and Igor Fruman made to Andrew Favorov in Houston. But in a recent series of interviews with the AP in Kyiv, Favorov painted a more complete picture of his dealings with Giuliani’s associates.”
“His tale, corroborated by interviews with other key witnesses, reveals that the pair continued to pursue a deal for months. The campaign culminated in May, at a meeting at the Trump International Hotel in Washington that included a lobbyist with deep ties to U.S. Energy Secretary Rick Perry and a Republican fundraiser from Texas close to Donald Trump Jr.”
“The maneuvering over Naftogaz came at the same time that Giuliani, with the help of Parnas and Fruman, were trying to get Yovanovitch out of the way and persuade Ukraine’s leaders to launch an investigation of former Vice President Joe Biden and his son Hunter’s work with Burisma, a rival Ukrainian gas company.”
“President Trump lashed out again at wind farms on Saturday, claiming that the production of wind turbines causes a large carbon footprint, The Hill reports.
Said Trump: “I never understood wind. I know windmills very much, I have studied it better than anybody. I know it is very expensive. They are made in China and Germany mostly, very few made here, almost none, but they are manufactured, tremendous — if you are into this — tremendous fumes and gases are spewing into the atmosphere. You know we have a world, right?”
He went on: “So the world is tiny compared to the universe. So tremendous, tremendous amount of fumes and everything. You talk about the carbon footprint, fumes are spewing into the air, right spewing, whether it is China or Germany, is going into the air.”