Is a Fracking Boom the Answer to America’s Woes? Yes and No.
Quick. What’s the first thing on an analyst’s mind after a Republican sweep? Congratulations if you said ‘energy stocks’; Warren Buffet would be proud of your business acumen.
The GOP thrashed the Democrats in the midterms and generated a wave of high fives throughout the oil and gas industry. The XL Keystone pipeline’s path from Alberta, Canada to the Gulf Coast has been all but cleared. Republican candidates’ clear message of jobs over less tangible issues like climate change resonated with voters.
For the first time in nearly 40 years, the Commerce Department ruled that two US companies can export condensate, a type of crude oil previously banned from sale abroad. Insiders explain that shipments are likely to be small, but they could serve as a valuable precedent to allow broad exportation of US unrefined oil products. While this appears as the government playing favorites for now, any move to allow markets to function without government intervention should be viewed as positive. Continue reading →