Bloomberg Businessweek - USA (2020-05-18)

◼POLITICS BloombergBusinessweek May 18, 2020

pollhasDemocratJoeBidenina tieat47%with

TrumpintheNovemberelection.

“Ithinkthismakesit morelikelythatTexas

goesbluesoonerratherthanlater,”saysBrendan

Steinhauser,a Republicanpoliticalconsultantand

formerTeaPartyactivistinAustin.“Thebottom

lineforindependent-mindedvoters—peopleinthe

middle—alotofthosevotersmightsay,‘What’s

myreasontosupportthepresident?’If theargu-

mentwastheeconomyis doingsogreat,well,now

it’snot.”

ButTexasis trickythiscycleforBiden,too.He

hastowoothosewhosupporteddemocraticsocial-

istSenatorBernieSanders(I-Vt.)andhisGreen

NewDealwithoutalienatingcentristsbyadopting

progressiveenergypoliciesthatcouldeliminate

fossilfuelsandthreatenoilcompanyexecutives.

ChrystaCastañedasaysa balancedenergyplat-

formcouldhelpBidenwinTexasandthepresi-

dency.She’sa Dallasoilandgasattorneyrunning

asa moderateDemocratfortheTexasRailroad

Commission,whichregulatestheoilandgasindus-

try.“JoeBiden’sbestmessageis,‘Texans,I hear

you,’” shesays.“Weneedtotakecareofpeople

whoarebeinglaidofftodayevenaswe’reactively

preparingforanenergyfuturethat’sgoingtolook

muchdifferent.”

Trumphasfacedskepticismfromanindustry

accustomedtoRepublicanpresidentsincludingthe

Bushes,whowereTexasoilmenbeforeentering

politics.“He’sgenerallyperceivedasa pro-fossil-

fuelpresident,buthisrhetorichasbeentheoppo-

site.Hekeepstryingtojawbonedownthepriceof

oil,”saysGeorgeSeay,a DallasRepublicanfund-

raiserandfounderofAnnandaleCapital.

“Ithinkhe’slookingattheoverwhelmingmajor-

ityofAmericanswhoaregoingtothegaspumps

andwanttoseelowerprices,”Seaysays.“Ialso

thinkhe’sanEastCoast,NewYorkkindofperson,

andtheyrememberhowNewYorkalmostwent

bankruptinthe’70sbecauseofa badeconomy

causedinpartbyhighergasprices.”Asrecentlyas

32

March 9, Trump tweeted, “Good for the consumer,

gasoline prices coming down!”

The oil and gas industry is big, complex, and

far-reaching. Exploration and production (that

is, finding fuel and then pumping it out of the

ground) is just one part of it. Dedicated so-called

midstream companies build enormous pipelines

that crisscross the country to move fuel around,

supplemented by trains and trucks. Refineries and

chemical plants turn the hydrocarbons into con-

sumer products such as gasoline, diesel, jet fuel,

and feedstocks for plastic, all of which have to be

moved around the country to end users. The indus-

try has a steady hunger for steel, valves, pumps,

pipes, and all manner of heavy machinery, from

diesel-powered frack fleets to drilling rigs.

Texas, Louisiana, and Oklahoma have the

most oil and gas jobs. But California, New Mexico,

Colorado, Ohio, Pennsylvania, Alaska, and other

states have significant employment in the indus-

try as well. And Texas’ loss could end up being

Pennsylvania’s gain.

Natural gas prices have also plunged because

of the pandemic. But without all the ancillary gas

coming off of oil wells, those prices are emerging

from their slump—which benefits the Pennsylvania-

dominated Marcellus Shale region, where fracking

produces natural gas without the oil. Rising natural

gas prices are a thin silver lining for the Keystone

State, among the hardest hit by the coronavirus.

“It provides an uptick for Appalachia. There’s

no doubt about that,” says David Spigelmyer, pres-

ident of the Marcellus Shale Coalition, a western

Pennsylvania industry group. “Natural gas is going

to be a catalyst for getting back to work, and if pol-

iticians dismiss it, they’re just hurting themselves.”

Trump eked out a victory in Pennsylvania over

Hillary Clinton in 2016 with a margin of 0.72%. Polls

conducted in the state in April gave Biden a lead

of several percentage points over Trump. Some of

those who’ll benefit from the natural gas price rise

Vote margin, 2016 presidential election

+30% Clinton 0

Oil and Gas Industry Jobs by State

◼Oil and gas account for

10k more than 4% of jobs

50k jobs

Te x a s

Calif.

Colo.

Va.

N .Y. Ga. Ohio

Fla.

N.M. Mich.

Alaska

La.

Ill. Pa.