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Ten signs the oil industry is bent out of shape

International crude oil prices have lost about 45% this month and fallen below the cost of much of the world’s production, causing energy companies worldwide to slash spending by tens of billions of dollars.

The collapse in demand and of energy diplomacy between Business News  Saudi Arabia, Russia and others have triggered unprecedented responses from governments and investors. Here are ten signs of an industry in distress.


Riyadh shocked the oil industry by going on the offensive after talks collapsed with Russia in early March on a deal to cut supply to compensate for how coronavirus was hitting demand.

Saudi Arabia slashed export prices and said it would pump at a record of 12.3 million Press Release Distribution Services For Business barrels per day, pouring a flood of oil into a market that needed less. It lined up an armada of ships for export, targeting refiners that buy Russian crude, as well as the United States, wiping out profit margins for U.S. exports.

The moves were all the more shocking coming from a producer that for years has had a role akin to the industry’s central bank. The kingdom is the de facto leader of the Organization of the Petroleum Exporting Countries (OPEC) and for decades adjusted output more than any other oil producer to keep markets balanced.

TEXAS CONSIDERS CUTTING PRODUCTION?
Producers in top U.S. producing state Texas went to regulators - and asked them to intervene to cut production. Texas does not intervene that much. The last time was in 1973. To be sure, other Texas commissioners and oil industry groups have thrown cold water on the idea.

One of three Texas commissioners at the body that regulates the industry got a call from the secretary general of OPEC to discuss the market. Commissioner Ryan Sitton said on Friday that Texas could consider a 10% output cut, possibly in coordination with that group. Before now, U.S. shale oil producers dared not consider coordinated cuts for fear of violating U.S. anti-trust laws.
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