“Take 2 Tax-Cuts, Rollback Regulations & Call Me In The Morning!” COVID-19 as excuse for profit

“We are in the midst of a crisis where people are literally having to skip work and may miss paychecks or face medical debt” because of coronavirus, said Robert Hockett, a professor at Cornell University who has advised Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.) on economic policy. “The idea you would look to help out shale companies now is like something out of a satire or a bad movie. It’s absurd.”

Partial predatory price behavior on the part of a Saudi-Russian “price war” appears more like WWE kayfabe that will alter the “competitive” structure of the fossil-fuel industry. The WH wants to give that industry unnecessary subsidies during a public health crisis in the guise of cheap vehicle fuel. How very Trumpian to prop up credit-short firms with “low-interest loans”. And then there’s those oil sanctions Trump will somehow cut.

The challenge of the spread of COVID-19 couldn’t have come at a worse time for OPEC plus Russia deliberations. OPEC members were already miffed at Russia by what they believed in retrospect to be a tricky request that Russia’s condensate production, a byproduct very similar to crude oil, not be counted in any production reduction agreement. Russia then increased its condensate output by 1.68 million barrels a day in the weeks following the December OPEC meeting. For its part, Russia is also frustrated with Saudi Arabia, which it feels has not reciprocated its cooperation over oil prices by forging stronger collaboration in other areas such as arms sales and co-investments in each other’s energy industry.

[…]

Any drop in U.S. shale production as vulnerable companies lose access to capital could prove short-lived once oil prices recover and productive properties move to stronger players through market consolidation.

[…]

Given the wide range of levels of financial leverage among industry players, increased tax breaks to industry might be less effective than other more direct measures to intervene to shore up credit markets. One such last resort approach could be special targeted lending facilities that allow lenders to distressed shale firms to gain liquidity by offloading some risk directly to the Treasury Department. 

www.cfr.org/…

A question on energy policy should be presented to the debate in AZ between Biden and Sanders. This will be the moment for kumbaya, and the leadership test for both candidates. Because Fracking:

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BREAKING: White House likely to push federal aid for shale companies hit by coronavirus/international energy shock

Trump confidante & oil billionaire Harold Hamm lost $2 billion yesterday. Hamm reached out to admin but says he didnt make “direct” contacthttps://t.co/GsjHIJE6VI

— Jeffrey Stein (@JStein_WaPo) March 10, 2020

— NYT National News (@NYTNational) March 11, 2020

— Crooks and Liars (@crooksandliars) March 11, 2020

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annieli

“You’re not mopping fast enough. (Laughter) That’s a socialist mop. (Laughter and applause) Grab a mop — let’s get to work.” – Barack Obama (2009); “Soyez réalistes, demandez l’impossible!”

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