In a WSJ News Exclusive, the news organisation is running with a title, “Texas Weighs Curtailing Oil Production for First Time in Decades” pertaining to the fall in the oil price which recently touched the $20 handle in WTI, the lowest levels since 2001.
“Texas regulators are considering curtailing oil production in America’s largest oil-producing state, something they haven’t done in decades, people familiar with the matter said,” the article reads.
Several oil executives have reached out to members of the Texas Railroad Commission, which regulates the industry, requesting relief following an oil-price crash, the people said.
Market implications
US benchmark oil closed around $25 a barrel Thursday and the US oil industry can’t rely on OPEC+ nor the first rounds of global government stimulus that have been proposed along with global central bank interventions. “Indeed, these programs can’t possibly address the coming demand destruction and swelling supply,” analysts at TD Securities explained.
“Given weaker and weaker demand expectations and surging OPEC+ production levels, crude oil could well drop significantly below $20/b in the not-too-distant future, as surging supply overwhelms shrinking demand and straining storage capacity.”
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