Lawmakers from Oil-Producing States Look to Find Solutions and Bring Relief to the Industry

Lawmakers from Oil-Producing States Look to Find Solutions and Bring Relief to the Industry

May 12, 2020

Last week, oil prices rebounded to $20 a barrel after falling to $0 a barrel in April for the first time. A good sign for the industry; however, recovery is still an uphill battle with analysts predicting a continued low demand for oil in the second quarter.

The economic slowdown caused by COVID-19 has reduced global demand for oil as people stay at home and businesses adapt to the new remote work environment, making it harder for the industry with a surplus supply to bounce back.

States with economies that rely on a thriving oil industry face job losses and budget holes, forecasted into the second quarter as companies continue to reduce production amid market troubles. Research firm IHS Markit projected that the oil sector will face its largest volume of production cuts in history during the second quarter by 22 million barrels a day from a year ago, Roll Call reports.

The harsh realities have forced the industry to make painful cuts, with more than a million oil fields service jobs likely to be lost this year, analysis firm Rystad Energy said in March. That is a nearly 20 percent reduction in the 5 million jobs for that sector. 

Lawmakers from oil states have been scrambling to find solutions and bring relief to the industry their constituents and local economies are so dependent on. Legislative efforts pushed by oil industry allies have faced immense opposition from the eco-left, highlighting the difficulty to get any help for the industry in a divided Congress.

“This is a situation where there is no one silver bullet here, so we’re working all angles,” said Murkowski, who also criticized lenders that have, under pressure from environmentalists and investors, stopped lending to fossil fuel firms.

Oil-state lawmakers discussed their fears about the industry’s troubles in a Friday meeting with Trump at the White House. We hope the government can find ways to assist the struggling industry essential to continuing our day-to-day activities, and the left can put aside their never-ending war on fossil fuels to focus on helping American communities desperate for relief during this time.