Cartoon Of the Week
This is a photograph of the America's most "important" oil executives in Washington on
Friday meeting with the President regarding the Saudi price war. Other than Harold Hamm, who has been whining for a government bail out for weeks, and maybe Jeff Hildebrand, all of these dudes at this table are big free enterprise believers and are adamantly oppose to any proration efforts by the Texas Railroad Commission designed to take production off the world market in hopes of raising prices. Most of the guys sitting at this table OWN lobbyists like the American Petroleum Institute are also outspokenly against proration.
All these fellas are on public record as saying they can hang in there and outlast this price war and beat back OPEC.
How are they going to do that? Well they all just borrowed $32,000,000,000, with a B, more money to drill more stinking unprofitable shale oil wells, that's how. They took advantage of now almost zero interest rates, and a fiscal monetary policy that creates socialized capital, and are going to get deeper in debt. That is essentially the only way they can beat back much lower cost producers in the world like the KSA and Russia. In other words, they have gone back to the Fed's pig trough, itself a big 'ol slimy bailout.
Don't be worried about major US shale oil players losing market share to OPEC and Russia because of a price war...they'll get that market share back by destroying the rest of the American oil industry with leveraged oversupply. Exxon can't drill those stinking shale oil wells in West Texas fast enough.
Borrow Baby Borrow, Drill Baby Drill.