Sheffield to Peers: Stop Drilling and Hunker Down

In an interesting story at Bloomberg today, Permian shale pioneer Bryan Sheffield, son of ex-Pioneer Natural Resources CEO Scott Sheffield, is quoted as advising his fellow shale execs to “cut immediately and hunker down” to weather the storm in oil prices being created by the international tariff war set off by President Donald Trump.

The Bloomberg piece quotes Haag Sherman, CEO of Tectonic Financial, a Houston-based bank, as saying, “You’re going to get squeezed from a production standpoint on prices and input costs,” If low prices persist, Sherman adds, “you’ll see capex come down in the latter part of this year.”

Another oil exec, Kirk Edwards, former Chairman of the Permian Basin Petroleum Association, is quoted as saying, “I don’t know an industry that was more supportive of Trump than the oil and gas industry. People are in shock at how quickly he can get the price of oil down.”

It has indeed been a precipitous drop. As of this writing mid-morning April 10, the price for West Texas Intermediate stood at $59.58, down from $71.71 just 8 days before on April 2.