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Why Texas can’t immediately fill the Russian oil and gas gap

CTN News

 

AUSTIN — Stephen M. Robertson can glance at traffic in Midland and tell you if oil is booming or busting.

Concerns over domestic energy are running high as Russia’s invasion of Ukraine rages on. But during business hours, Robertson can take a look at the volume of trucks — or the lack thereof — on the roads and get a clear indication of whether the Permian Basin, a vast stretch of West Texas and New Mexico nearly the size of Minnesota, is humming with production.

When production is down, Robertson sees trucks idling about the city. But not now, and not for the past several months.

“Right now those trucks, yeah, they are out in the field,” said Robertson, the executive vice president of the Permian Basin Petroleum Association, an advocacy group.

Texas’ oil and natural gas production has rebounded in a big way from the COVID-19 doldrums and is projected by the U.S. Energy Information Administration to post record production this month. That record likely will be broken again in April, the EIA projects.

These never-before-seen levels of production come as many political leaders in Texas and Washington, especially Republicans, are calling for the U.S. to ramp up oil and natural gas production in the wake of a burgeoning energy crisis triggered by the Russian invasion of Ukraine just more than a month ago.

But those calls for sharp increases in production amid soaring gasoline prices are likely to go unheeded. Investor resistance to expansion, a lack of infrastructure, labor shortages and political signals from the White House are major obstacles leading large companies to eschew reinvestment despite West Texas crude oil prices remaining above $100 a barrel.

Any move to boost production would require full buy-in by oil and natural gas producers in Texas. By itself, the Lone Star State is the third-largest producer of oil in the world, home of two of the five largest oil fields in the world — the Permian and the Eagle Ford Shale.

However, the state is already…

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