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This has already happened. It is not a coincidence that we went from $-40 oil to $130 oil in the span of two years. I posit the Saudis and Russians deliberatel

by fny 4y ago

This has already happened. It is not a coincidence that we went from $-40 oil to $130 oil in the span of two years. I posit the Saudis and Russians deliberately maintained elevated production levels into the COVID shutdowns in an attempt to handicap US energy production. Bankruptcies in the US ensued. Wells were shut. Supply went offline. Now we're begging them to turn the wells back on, and they're not interested. Evidence to ponder for the unbelievers. [0]: In March 2020, Saudis and Russians can't come to an agreement about cutting output into a global shutdown (this was clearly a show) https://www.csis.org/analysis/oil-price-war https://www.csis.org/analysis/oil-price-war [1]: Trump pushes Saudis to cut production into negative oil, US bankruptcies ensue https://www.reuters.com/article/us-global-oil-trump-saudi-specialreport/special-report-trump-told-saudi-cut-oil-supply-or-lose-u-s-military-support-sources-idUSKBN22C1V4 https://www.reuters.com/article/us-global-oil-trump-saudi-sp... [2]: Biden tells Saudis to boost production amid $100 oil https://www.businessinsider.com/us-officials-ask-saudi-boost-oil-production-russia-attack-fears-2022-2 https://www.businessinsider.com/us-officials-ask-saudi-boost... [3]: At all time high prices, OPEC is still behind its production targets. https://www.reuters.com/business/energy/opec-oil-output-march-resumes-trend-lagging-pledged-hikes-survey-2022-04-01/ https://www.reuters.com/business/energy/opec-oil-output-marc... The beauty of this strategy is that is creates the continued fear that at some point the Saudis will turn on the tap and oil can go sub $60 again (see futures prices at the long end of the curve), so the US is still wary of investing in oil and gas to deal with the shortage. Everyone seems to forget the Saudis created an oil crisis in the 70s for political gain once. How we are not talking about this today more actively is beyond me.

greenglass 4y ago
- colincooke 4y ago
  There is a major difference between long term investments (selling federal land leases) and encouraging short/medium term supply (use of existing leases, encouraging more oil production from existing facilities). I see no incoherence in denying _new_ leases, since O&G sector is already sitting on many existing leases [1], and in the _long_ term I think we need to drastically reduce the production of oil and gas to lessen the damage of climate change. The moves to deny new leases is in line with those views/meets my expectation of encouraging medium-term supply without a long-term commitment to fossil fuels. [1]: https://www.americanprogress.org/article/oil-gas-companies-lying-much-oil-control-u-s-public-lands/ https://www.americanprogress.org/article/oil-gas-companies-l...
  - greenglass 4y ago
epgui 4y ago
Did you read the article? The article explains at length that “this has already happened”.
- deleted 4y ago
  [deleted]
walkhour 4y ago
This is a nice story but this: > Bankruptcies in the US ensued Never happened. What happened is that the US voluntarily shutdown their oil production out of concerns for the environment. So however this idea of the Russians and Saudis would surely make for a good plan, it's more suited for the plot of a new TV series.
- jason-phillips 4y ago
  > Never happened. What happened is that the US voluntarily shutdown their oil production out of concerns for the environment. As someone who lives in Texas not too far from the oil patch, this made me double cringe. Folks were put out of work, companies went under. They didn't voluntarily decide to stop feeding their families for the reasons you noted. Where did you get that information?? "Bankruptcy debt across the North America oil and gas industry passed $100bn in 2020 for the first time, reflecting the huge financial impact of the pandemic-triggered market crisis. In what was “arguably the most devastating year in history” for the sector, 108 companies filed for Chapter 11 bankruptcy support, with a combined debt of $102bn, according to an analysis by consultancy Rystad Energy."[0] [0] https://www.nsenergybusiness.com/features/oil-gas-bankruptcy-2020-north-america/ https://www.nsenergybusiness.com/features/oil-gas-bankruptcy...
xrobledo84 4y ago
It was in their interest to keep producing oil. If you stop you can lose market share.

by fny 4y ago

greenglass 4y ago

colincooke 4y ago
There is a major difference between long term investments (selling federal land leases) and encouraging short/medium term supply (use of existing leases, encouraging more oil production from existing facilities). I see no incoherence in denying _new_ leases, since O&G sector is already sitting on many existing leases [1], and in the _long_ term I think we need to drastically reduce the production of oil and gas to lessen the damage of climate change. The moves to deny new leases is in line with those views/meets my expectation of encouraging medium-term supply without a long-term commitment to fossil fuels. [1]: https://www.americanprogress.org/article/oil-gas-companies-lying-much-oil-control-u-s-public-lands/ https://www.americanprogress.org/article/oil-gas-companies-l...
- greenglass 4y ago

epgui 4y ago

Did you read the article? The article explains at length that “this has already happened”.

deleted 4y ago
[deleted]

walkhour 4y ago

This is a nice story but this: > Bankruptcies in the US ensued Never happened. What happened is that the US voluntarily shutdown their oil production out of concerns for the environment. So however this idea of the Russians and Saudis would surely make for a good plan, it's more suited for the plot of a new TV series.

jason-phillips 4y ago
> Never happened. What happened is that the US voluntarily shutdown their oil production out of concerns for the environment. As someone who lives in Texas not too far from the oil patch, this made me double cringe. Folks were put out of work, companies went under. They didn't voluntarily decide to stop feeding their families for the reasons you noted. Where did you get that information?? "Bankruptcy debt across the North America oil and gas industry passed $100bn in 2020 for the first time, reflecting the huge financial impact of the pandemic-triggered market crisis. In what was “arguably the most devastating year in history” for the sector, 108 companies filed for Chapter 11 bankruptcy support, with a combined debt of $102bn, according to an analysis by consultancy Rystad Energy."[0] [0] https://www.nsenergybusiness.com/features/oil-gas-bankruptcy-2020-north-america/ https://www.nsenergybusiness.com/features/oil-gas-bankruptcy...

xrobledo84 4y ago

It was in their interest to keep producing oil. If you stop you can lose market share.