Liz Hampton | Reuters
Oklahoma’s energy regulator said on Wednesday that oil producers could close wells without losing their leases, the first victory for struggling U.S. companies seeking relief from states after the market crash.
Several U.S. states have considered aiding oil companies, many of which were already hurting before demand tanked during coronavirus pandemic lockdowns. That, and ballooning supply, sent U.S. prices into negative territory for the first time ever on Monday.
In an emergency order, the state energy regulator said oil companies could consider their unprofitable production economic waste, allowing oil and gas producers with money-losing wells to retain leases that could otherwise be voided if they halted output.
“There was no way for Oklahoma and other U.S. producers to anticipate and plan for up to 30 million barrels per day of consumption to disappear within just a few weeks,” Oklahoma Corporation Commissioner Dana Murphy said in a statement.