• 4 minutes Energy Armageddon
  • 6 minutes "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 12 minutes "Europe’s Energy Crisis Has Ended Its Era Of Abundance" by Irina Slav
  • 2 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 1 hour Is Europe heading for winter of discontent with extensive gas shortages?
  • 2 days Wind droughts
  • 6 days "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 33 mins Kazakhstan Is Defying Russia and Has the Support of China. China is Using Russia's Weakness to Expand Its Own Influence.
  • 10 hours ""Green" Energy Is a Scam. It Isn't MEANT to Work." - By James Corbett of The Corbett Report
  • 4 days Oil Prices Fall After Fed Raises Rates
  • 5 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 12 days "Russian oil executive and Putin critic Ravil Maganov dead after mysterious six-story fall" - The New York Post
  • 3 days 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 9 days Beware the Left's 'Degrowth' Movement (i.e. why Covid-19 is Good)
  • 11 days The Federal Reserve and Money...Aspects which are not widely known
  • 13 days How Far Have We Really Gotten With Alternative Energy

Breaking News:

Gasoline Draw Sends Oil Prices Higher

Texas Oil Regulators Consider Production Cuts After Historic Oil Price Crash

The Texas oil and gas regulator, the Texas Railroad Commission, is meeting on Tuesday to hear testimony about potentially curtailing statewide oil production after U.S. oil prices plunged 300% to settle at -$37 a barrel on Monday.

The Texas Railroad Commission has already held a first hearing on possible mandated curbs in the oil-producing state home to the Permian Basin.

At last week’s hearing, Pioneer Natural Resources and Parsley Energy were pushing for the first proration of oil production in Texas since the 1970s. Meanwhile, major companies, including ExxonMobil and pipeline operators, expressed opinions that the regulators should let the free market dictate the production in the state.

Smaller independent producers tend to support some kind of coordinated action to restrict supply, arguing that the free market will wipe out the smaller guys in the industry.

Enterprise Products Partners Co-CEO Jim Teague, for his part, told the Commissioners in his testimony, as carried by CBS7:

“Do you really think that a cut by Texas can fill a 25 million barrel demand hole?”  

Today’s meeting of the Texas Railroad Commission comes just a week after the previous one. Still, the market circumstances and sentiment are so much more dire this time, with WTI Crude oil prices sinking into negative territory for the first time in a 300% price crash on Monday. While the price collapse was driven by the expiry of the May futures contract today with traders running for the exit to avoid getting stuck with holding actual physical barrels for delivery with no place to store oil, the sentiment has spread to Brent Crude prices today, which plunged by 20% to $20 a barrel early on Tuesday.

Commenting on Monday’s WTI Crude price crash, Texas Comptroller Glenn Hegar said in a statement:

“Today’s market activity was unprecedented and likely indicative of very limited storage capacity. May contracts traded well into negative territory as the market prepares to shift focus to June contracts.”

“While this unprecedented volatility is concerning, the greater impact to Texas will come if demand remains historically low for a prolonged period of time and supply gluts continue to strain storage capacity,” Hegar said.  

“A key question is whether we could see a repeat of this with the June expiry next month. It is likely that storage this time next month will be even more of an issue, given the surplus environment, and so in the absence of a meaningful demand recovery, negative prices could return for June,” ING strategists Warren Patterson and Wenyu Yao said on Tuesday.  

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment
  • Oil Barron on April 21 2020 said:
    WTF.

    Do these oil producers really need big government to tell them to stop drilling while they are PAYING PEOPLE TO TAKE THEIR OIL?

    But I guess now it seems President Trump is charge of OPEC+, so....

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News