OIL REGULATION – The Texas Railroad Commission regulates oil and gas production in the Lone Star State, and hasn't mandated production cuts since the 1970s. This week some oil and gas companies asked the Commission put a cap on production to possibly stabilize historically low oil prices. This move comes after oil prices have dropped to their lowest in years due to Saudi Arabia flooding the international market with cheaper oil. A virtual commission hearing took place this week exploring the possibility to cap oil production and a vote could come in the next several days. Some companies say that --in these unique times-- those measures are needed to stabilize the market but others disagree, and say the free market should be left alone. Lee Tillman is the C-E-O of Houston-based Marathon Oil.
“Supply and demand imbalances will always occur, and in those times some companies will succeed and others will fail," Tillman said. "So we have to ask what will be the threshold to toss aside free market principles in the future?”
The Texas Railroad Commissioners are considering cutting oil production by one-million barrels a day for the month of May. They meet again on April 21st, when they could take a vote on the cuts.
For more information: Click Railroad Commission of Texas
