Trump Pledges Support for Embattled Oil Industry -- Update
By Timothy Puko and Christopher M. Matthews
WASHINGTON -- President Trump promised oil-industry leaders the
government would help revive the sector during a much anticipated
White House meeting Friday.
Chief executives of Exxon Mobil Corp. and Chevron Corp. and
leaders of seven other energy companies joined the president as the
new coronavirus pandemic slows the economy and ravages the energy
business. Dwindling demand has helped to halve crude prices since
January and more than 70 U.S. oil companies, already heavy with
debt, are at risk of bankruptcy, energy analytics firm Rystad
Energy said Friday.
"The entire world is shut down trying to get rid of this
scourge," President Trump said about the pandemic before
introducing oil executives at the meeting. "We'll work this out and
we'll get our energy business back."
The first part of the meeting, mostly introductions and
platitudes, ended after an hour. President Trump said there would
be a news conference to discuss more developments later Friday.
Saudi Arabia and Russia are pressing the U.S. to coordinate cuts
to oil output in an attempt to stabilize prices. The outcome of a
virtual emergency meeting the two are planning for Monday with the
Organization of the Petroleum Exporting Countries may largely
depend on whether President Trump and U.S. oil companies can reach
a consensus on U.S. production cuts.
While some in the industry want the Trump administration to
pressure the Saudis and Russians, many large U.S. oil companies
oppose cooperation between the world's three biggest
crude-producing nations, which would be unprecedented. Exxon Mobil
and Chevron have lobbied against any market intervention, and the
possibility wasn't discussed in the first part of the meeting.
Some smaller companies that drill U.S. shale wells want the
government to intervene aggressively. Pioneer Natural Resources has
pushed to find ways for the U.S. to join the plan led by Saudi
Arabia and Russia. Continental Resources and its founder and
Executive Chairman Harold Hamm, who was at the meeting, have pushed
for aggressive tactics such as antidumping measures or U.S.
government investigations of the Saudis for flooding the
President Trump and administration officials have been working
diplomatic channels to stabilize the market and have been exploring
a wide range of domestic solutions. But options are limited to help
beleaguered U.S. oil-and-gas companies in part because of U.S.
antitrust laws and strong differences within the industry, making
the prospect of any agreement challenging.
President Trump spent the early parts of the meeting touting the
potential for an infrastructure package to go through Congress,
though that idea is in only its earliest phases and has failed to
gain traction at other times during President Trump's term. And he
mentioned a plan to rent empty space in the Strategic Petroleum
Reserve to store oil for the private sector, a plan with wide
support but with little capacity to make a material difference.
President Trump during a briefing said oil executives didn't ask
for a bailout. "It was really more of a discussion than asking. We
did discuss the concept of tariffs because, as you know, this was a
dispute among a couple of countries," he said.
Referring to Russia and Saudi Arabia, he said, "they want to get
Write to Timothy Puko at email@example.com and Christopher M.
Matthews at firstname.lastname@example.org
(END) Dow Jones Newswires
April 03, 2020 18:51 ET (22:51 GMT)
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