Friday afternoon, President Trump met with Big Oil company executives at the White House to discuss this Oil price decline threatening their businesses, brought on by the coronavirus outbreak and a Saudi-Russia price war.
“We will work this out and we will get our energy business back,” President Trump told reporters while surrounded by cabinet members, Oil state lawmakers and executives from big producers Exxon Mobil, Chevron Corp, and Continental Resources prior to the beginning of private talks.
The administration may offer ways to help the industry weather the crisis, including waving royalty payments drillers must pay for Crude Oil produced on federal lands, imposing an import tariff on foreign Crude Oil or easing shipping regulations, according to sources familiar with the matter.
President Trump discussed his efforts to push Moscow and Riyadh to end their price war and tighten the taps to boost prices, the main hope for an ailing US exploration industry that supported his Presidential campaign.
“I think President Putin and the crown prince want something to happen badly, certainly it is terrible for them what is happening too. So, they want to see something happen,” President Trump said before the meeting began.
President Trump said Thursday that Saudi Arabia and Russia agreed to cut output by an unprecedented 10 to 15-M BPD representing 10% to 15% of global supply, after he discussed the issue with their leaders.
The countries did not confirm the President’s plan, but said they were willing to discuss ways to stabilize the market with other major world oil producers.
The United States has become the world’s biggest Crude Oil producer, that put it in competition with Russia and countries in OPEC, even as it imposes sanctions on cartel members Venezuela and Iran.
Global Crude Oil prices have fallen by roughly two-thirds this year, raising the possibility of a wave of US oil drilling bankruptcies and layoffs.
The American Petroleum Institute (API), which represents the US Oil and Gas industry, had asked President Trump for regulatory relief to ensure steady supplies during the pandemic. The administration has since announced a temporary easing of environmental enforcement.
WTI Crude Oil rose 3.16, or 12.6%, at 28.34 bbl Friday, extending this week’s gainer to 6.69 or 30.9%.
Friday, major US stock market indexes finished at: DJIA -360.91 to 21052.53, NAS Comp -114.23 to 7373.08, S&P 500 -38.25 to 2488.65
Volume: Trade on the NYSE came in at 1.43-B/shares exchanged.
- NAS Comp -17.8% YTD
- S&P 500 -23.0% YTD
- DJIA -26.2% YTD
- Russell 2000 -37.0% YTD
HeffX-LTN’s overall technical outlook for the major US stock market indexes is Bearish at the week ending 3 April 2020.
Looking Ahead: Investors will not receive any economic data Monday.
Have a healthy weekend, stay home!