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Texas declines to mandate oil production cuts
Mnuchin: No bailout for oil companies
Treasury Secretary Steven Mnuchin says there will be no financial aid package for the oil companies amid the coronavirus and that it will eventually rebound.
HOUSTON (Reuters) – Texas energy regulators on Tuesday said they will not mandate oil production cuts, ending a month-long debate about whether or not they would wade into global oil politics for the first time in 50 years as crude prices crater to historic lows.
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Global energy demand has tumbled amid coronavirus-related travel and business restrictions and a glut of oil from shale. U.S. crude collapsed to minus $37 a barrel on April 20. Even with recent increases in futures to $24, local prices are still below the cost of production for some oil companies.
The turmoil prompted State Railroad Commissioner Ryan Sitton last month to push the idea after Parsley Energy Inc and Pioneer Natural Resources Co asked regulators to mandate 20% curtailments, or 1 million barrels. Sitton promoted the curbs on Twitter and TV and won audiences from OPEC Secretary General Mohammad Barkindo and Russian Energy Minister Alexander Novak.