Skip to main content

The White House is considering providing federal assistance for oil and natural gas producers affected by plummeting oil prices, as industry officials with connections to the administrations call for help, according to the Washington Post

Oil and gas firms were sent into shock as a price war broke out between Saudi Arabia and Russia, which drove the price of oil down in their steepest one-day drop in almost 30 years. 

White House officials fear that numerous shale companies, many of them already deep in debt, could be driven out of business if the decrease in oil prices turns into a prolonged affair. 

Major oil companies are threatened by the oil price slump, such as Occidental Petroleum, which slashed its divident to 11 cents a share from 79 cents and cut capital spending by a third on Tuesday. 

Continental Resources was one of the companies hardest hit. Founded by Harold Hamm, a Trump supporter and an adviser to the president on energy issues, Continental lost more than half of its market value on Monday. Hamm’s 77 percent personal stake in the company lost $2 billion of its value Monday.

Hamm said the administration should consider “any action that the administration might take to protect and preserve American interests at this time from being unfairly disadvantaged by whatever government -- and we’re talking governments here, whether it be Russia or Saudi Arabia.”

“I don’t want to prescribe what the president would or shouldn’t do. He’s very capable of handling this situation,” he said, but still wanted to discuss the number of jobs on the line and “how this could jeopardize those jobs and the economies in producing states and communities across America, from Pennsylvania, to California and Texas to North Dakota.”

As the coronavirus risks punge the entire U.S. economy downwards, some economists oppose providing assistance to companies and would rather ensure that it goes to workers hit by a downturn. 

Read more.