Latest news with #Patterson-UTIEnergyInc.

Calgary Herald

Trump's thirst for cheap oil irks an industry he loves to praise

Article content Terrel Hardin was at a diner along Route 66 in western Oklahoma when his phone rang with bad news: The engine on one of his oil rigs had broken. In times past it would be a straightforward $6,000 fix, but President Donald Trump's trade war has upended supply chains, and he wasn't sure the part would even be available. Article content Tariffs and uncertainty over equipment deliveries mean what was once routine for Hardin's King Well Service Inc. is now a source of anxiety. It's made all the worse by plunging crude prices, triggered in part by the trade disputes, that threaten to slow drilling of new wells. Article content Article content 'It's not really being helped by what Trump is doing,' the 63-year-old said. 'He's a hell of a lot smarter than I am, but I'm not sure that he wakes up every morning saying, 'God, I hope oil goes back to $70,'' he said. 'Like I do.' Article content Article content The U.S. oil industry strongly supported Trump's campaign for a second term, but some executives are now feeling shortchanged. The president's trade policy has made buying and repairing equipment more expensive at the same time crude has tumbled more than 20 per cent since his inauguration, further undermined by a surge in supply from OPEC. Article content Falling oil prices help achieve a key pledge of Trump's campaign — to lower inflation — and are generally good for the economy writ large and popular with voters. But now that the U.S. is the world's top crude producer, that slide is straining Republican strongholds like Texas, Oklahoma and North Dakota. Article content 'You can't have $50 oil and 'Drill, Baby, Drill,'' said Andy Hendricks, the CEO of Patterson-UTI Energy Inc., which operates the second-largest fleet of U.S. onshore drilling rigs. 'Those two things are incompatible.' Article content Article content Executives from several private and independent oil companies have met in recent weeks with Texas Senator Ted Cruz, Energy Secretary Chris Wright, Environmental Protection Agency administrator Lee Zeldin and congressional representatives, according to company officials. The message they're promoting is Trump's trade war and repeated praise for falling oil prices risk pushing record U.S. production into decline. Article content While oil majors like Exxon Mobil Corp. and Chevron Corp. are content to ride out the storm, especially if it means less regulation and easier permitting over the long term, the smaller independent producers who are the backbone of the U.S. shale industry are starting to push back. Article content 'The industry's message to Congress is 'Take back your authority,'' said Steven Pruett, the chief executive officer of Midland, Texas-based Elevation Resources LLC, who met with Cruz last month. He's concerned that major economic policy is being set by executive fiat. 'That's no way to run a country, and it's impossible for corporate leaders to run their businesses.'