(Southside Light News) -- The Texas Railroad Commission did not vote on the topic of proational cuts on Tuesday when the Commission met in a planned meeting.
By deciding to not vote on the topic of a 20% production cut, the commission in essence rejected a proposal to cut Texas oil production by 20% to help with offset the oversupply of oil brought on by COVID-19 and the Saudi/Russian dispute earlier this year.
“They made the right move,” said Bryce Holley, a Houston based energy consultant and market analyst with Mercuria. “There is no doubt that when this thing play itself out that we will see demand increase and that will bring all of those jobs that certain people are talking about right back.”
Holley says that as we speak there are tankers loaded with Persian Gulf oil heading for storage and production facilities here in theUnited States. He says that he feels there is no harm in sending that oil right back to where it came from.
“You are in Corpus Christi and I am in Houston. Much of that oil is coming our direction and frankly there is just no place to put it,” Holley explains. “What we need to do is just bite the bullet and ramp up production so we can start using what we have on hand already.”
“The fact is that prorationing has already begun and there was simply no need for further cuts,” Holley explains. “The market will take care of itself and those that are screaming about all of the jobs being lost and everything else, they just do not understand how markets work. They are just bad business people.”