- Democrats slam the idea of bailing out oil companies
- Brent Crude oil fell 24% on Monday
Russia’s Energy Minister last week had walked out from a meeting chaired by OPEC to discuss further oil production cuts saying that the current oil prices are aligned with the country’s macro-economic policies. Wowing retaliation Saudi Arabia wowed to increase its oil production, though it had at first agreed to cut the total global production by 1.5 million bpd. It had further offered to cut its own oil production by 4,00,000 bpd.
All the major oil companies are threatened by this latest round oil war between the Russians and the Saudi’s. As a result of Saudi Arabia’s plan to increase oil production, oil prices further dropped by 20-24% worldwide. Although it recovered slightly by 8% on Tuesday. Occidental Petroleum is known to have cut the dividend on its shares to 11p from the earlier 79p. It is also believed that the company cut its capital expenditure by one third.
According to sources the White House has plans to provide low interest loans to oil and gas companies to temporarily sail through this rough period.
However, several US democrats and environmentalists have slammed to move to repeatedly bail out large oil and gas corporations that are majorly responsible for the worsening climate change.
Rep. Raúl Grijalva [Democrat] in a House hearing questioned the White House saying, “Why is the administration bailing out oil and gas companies instead of dealing with some of the other worker related things…that are pressing on the American people right now during this crisis related to the virus?”