Insight and inspiration in turbulent times.
Last August, ExxonMobil warned that it may need to remove 20 percent of its oil and gas proved reserves from its books. While that was a shocking number from the oil major, reality proved to be even more of a shock to the company
The decade-long fracking boom in Appalachia has not led to significant job growth, and despite the region’s extraordinary levels of natural gas production, the industry’s promise of prosperity has “turned into almost nothing,” according to a new report.
ExxonMobil announced a $19.3 billion write-down on Tuesday, a big hit to a company reeling from depressed oil and gas prices and a rapidly changing global energy market.
The Conference Board report appeared two weeks after the publication of a highly-detailed analysis by energy expert David Hughes that said the math on LNG did not add up in terms of economics, climate change, jobs or royalties.
Fracking came on stream more than 15 years ago during a period of high oil prices and cheap credit. But the industry then tanked global prices for oil and methane with rampant overproduction in North America.
To the extent that oil demand goes down in the future, it will go down because people can’t afford oil distillates at the price producers need to produce the corresponding oil.
If oil has been laid low by the coronavirus, then the nations whose economies most depend on it might soon be on ventilators. By any prognosis the great oil price collapse of 2020 has pushed the world’s most volatile commodity into Code Blue.
The price of U.S. crude oil collapse to below zero for the first time on record, falling to negative-$37 per barrel and forcing oil producers to pay buyers to take the product off their hands.
The finances of the oil and gas industry are so dismal that the major banks that have funded the money-losing fracking boom are now exploring taking the unusual step of taking over the oil companies that cannot afford to pay back the banks’ loans.
In the last episode Asher, Rob, and Jason discussed the danger of political denial and delusion limiting how well we respond to the climate crisis. This week we address the risk that another “d”–distraction–will keep us from recognizing the huge threats and opportunities the pandemic presents for our energy future.
Is it misleading to laugh at your company’s investors if you know the estimates you are giving them are inflated, but because you own the stock that benefits from those estimates, you do it anyway? Is that fraud? Perhaps that depends on if you get you get ethics lessons from Andrew Fastow and Jim Hackett.
Long before the COVID-19 outbreak, fracking firms in the Permian Basin were experiencing a downturn. Now the dramatic devaluation of oil prices will likely bring the already declining drilling boom in the country’s shale regions to a near halt.
