I told a reader:
By the way, I don't know if I will bother to post it or not, but Biden's
energy tsar, over the weekend, is telling shale operators it's their
patriotic duty to drill more wells -- despite the Biden policy: "no more
drilling." I guess the word he used was "un-American."
For an administration that killed the Keystone XL; continues to ban drilling; and slow-rolls the industry on approving permits -- that's pretty rich -- calling guys like Harold Hamm, "un-American."
"Political posturing" and "talking to your base" have little to do with reality.
But this is the real reason by the Biden folks are so upset.
First, one has to remember, the entire left wing loathes -- absolutely loathes -- Big Oil. There's only one thing they loathe more: every-day oil folks making more money while drilling fewer wells. LOL.
So, what's the real reason oil companies aren't drilling more? Certainly they're not listening to the Biden administration. LOL.
Here's why:
As to why they weren't drilling more, oil executives blamed Wall Street. Nearly 60% cited "investor pressure to maintain capital discipline" as the primary reason oil companies weren't drilling more despite skyrocketing prices, according to the Dallas Fed survey.
Only 11% cited environmental, social or governance issues; 8% said they had difficulty getting financing; 15% cited other reasons.
What price WTI to drill more [spoiler alert: $300]:
Asked
what level the price of West Texas Intermediate oil would need to hit
to get publicly traded oil and gas companies back into growth mode, 29%
of executives said that their expansion plans weren't dependent on
price. Another 9% named a price above $120 a gallon.
"Forty percent of respondents don't think that a price
of $120 a barrel, which is very profitable from what we know about the
marginal cost of shale production, is enough to increase output," said
Paul Ashworth, chief North America economist for Capital Economics.
Investor pressure:
Many companies are choosing to
enjoy their high profits rather than increase the supply of oil.
That's despite the relatively low oil price they would need to turn a
profit.
On a different Dallas Fed question, executives said oil prices
between $23 and $38 a barrel, on average, would cover the cost of
drilling new wells.
So, what's the real reason oil companies aren't drilling more? Certainly they're not listening to the Biden administration. LOL. Actually this is the irony:
Oil companies are so incredibly patriotic supporting Biden's policy: no more drilling.
