RBN Energy executive Rusty Braziel suggested that having lower oil prices was at odds with increasing production — both of which were some of Donald Trump’s fervent campaign promises.
“The situation is, you cannot have ‘drill, baby, drill’ and have that much more production coming out of the ground, and at the same time have lower…oil prices,” Braziel said. “It doesn’t make any sense.”
According to Braziel, U.S. Energy Secretary Chris Wright has a “tough job” ahead. Wright, a former oil executive, understands the industry and how to boost oil production, Braziel continued. But he indicated it will be difficult for Wright to successfully do that while prices are low because companies will be reticent to drill. Regardless of how many areas the U.S. government opens for drilling, Braziel continued, “at these prices, those wells are simply too expensive for the production that you get out of them.”
Oil prices have plummeted as recession fears continue to weigh on the business world. Earlier in April, key members of OPEC+ agreed to accelerate oil production, which helped drive prices down. But prices held steady around $60 on Monday — even though OPEC cut its demand forecast for 2025 and 2026, suggesting uncertainty caused by Trump’s heavy-handed tariffs could hinder global economic growth.
Braziel said drilling would be affected if prices declined to $50, but he maintained that at $60, “most producers are still profitable, particularly those that are in the Permian.” RBN Energy provides consulting services to energy companies, and, according to Braziel, many clients say they are “going to sit on the sidelines” until there’s more economic certainty.
“The marketplace is deer in the headlights right now, and that’s the way it’s going to be until we start seeing some sort of stability,” he said.