Publications: Notes at the Margin

2024 Oil Markets: Reassertion of Adult Supervision (January 8, 2024)

 

Oil markets have lacked “adult supervision” since the early 1970s when exporting countries nationalized the concessions developed by multinationals with little or no shareholder compensation. This situation may be changing. The adult supervision of the large multinationals may return in 2024 as firms such as ExxonMobil finally begin to increase output and prevent wild price swings, working to keep oil between $50 and $70 per barrel. Long-term company veterans like Exxon CEO Devon Woods and Chevron’s Mike Wirth likely see this strategy, coupled with accelerating carbon capture projects, as the best way to preserve the majors’ role for the next half-century. They will undertake this effort, though, with as little fanfare as possible to avoid upsetting the “children” who have been trying to control oil since 1971, especially Saudi Arabia’s Crown Prince Mohammad bin Salman.

 

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