WaPo: Struggling U.S. oil companies hope for more economic help in next coronavirus stimulus package

I spoke to Dino Grandoni of the Washington Post about Congress’ decision to scrap SPR funding in the CARES Act and what they might do to provide the energy sector relief in future phases.

But the push to buy oil to replenish the nation’s Strategic Petroleum Reserve could come up again as Congress is expected to take up another stimulus package next month in response to the deadly pandemic.

“That’s when you can slow down the legislative process and not throw together a trillion-dollar bill in a week,” said Liam Donovan, an energy lobbyist at the Washington-based firm Bracewell.

After the bill became law without the oil money, the Energy Department scrapped plans to buy 77 million barrels to reload the emergency oil stockpile — a move the Trump administration had said was prudent since the price of West Texas Intermediate has dropped by 65 percent since the start of the year.

Though that amount of oil is small for a nation that consumes about 20 million barrels of petroleum per day, the federal government’s purchase would have been a “signal to the industry” that more help was on the way, Donovan said. It could have also been a way for the federal government to make money, by buying oil while prices are low and selling it when they are high again.

Read the full piece here.

You may also like

Leave a Reply

Your email address will not be published. Required fields are marked *