Drill, Baby, Drill Is Dead: Here's Why Oil Companies Won't Drill

Hinzugefügt: 2026-05-18

[00:00:00]So, why does drill baby drill not seem to be working?

[00:00:05]Look, everyone, it's a very simple thing. There's cataclysmic issues across the globe right now when it comes to energy and every country is trying to decide the core of their economy and how much is going to be negatively affected by the absence of enough crude oil in global supply. This is not about trying to find soft barrels. This is not about finding barrels that were in storage or in pipelines or at terminals or in large tanks or refineries. Those soft barrels will always be in those particular facilities to some degree or another.

[00:00:37]You're never going to have empty tanks at a refinery. You're never going to have empty pipelines. They'd have to be re replenished again. They'd have to be recharged again. You'd have to retool those pipelines. So, there's a certain amount of oil they claim is in the supply chain that will never be absent.

[00:00:51]So, you can't count those barrels.

[00:00:53]You then take from the wellhead and you take it all the way down to the end consumer. You say but absent current production and movement through the straight of Hormuz and the crisis that's going on in the Middle East, what you have is you have an absolute default.

[00:01:06]The default is not enough supply to match a growing demand on a global basis.

[00:01:11]So, when we think about the president of the United States continuing to say, "Drill, baby, drill," and every one of these so-called expert announcers and financial analysts and these pundits that are out there saying, "All we got to do is just get past the straight of Hormoose. Then everybody's going to go back to drill baby drill. The federal government is going to give you federal leases and state leases and out in Gulf of America leases and we're it doesn't matter if you give us every lease that you have. If you can't make up the differential between what it cost and the risk that we take and the cost of capital, the cost of drilling, the cost of production, the cost of mission, if you can't take all our inclusive costs, including all the taxes that we pay by producing oil and gas from the different states that we're in into the federal government, if you can't take any of that away, you're telling us go get super aggressive to drill your very best tier one, your premium locations, and produce as much oil as you can to make this country safe. And we want you to do it at 20 to 30% below break even. 20 to 30% below any reasonable amount of profit. I don't care if you're Google. I don't care if you're Nvidia. I don't care if you're Intel. I don't care what major corporation you are. Not one single industry would ever go for it under the guise of go build it, develop it, manufacture it, take the risk, and guess what? Sell it for 30% below your break even price. And this isn't about Exxon's price. This is the industry's price. Break even is across the board.

[00:02:34]It's not one business. It's not one company. It's not one field. It's on average. And just because most of us are not Exxon doesn't mean that we're going to go, "Oh, don't worry about it.

[00:02:43]Exxon's okay at $40 a barrel." Yeah.

[00:02:45]Because they have half their profit in refining and half in production. They make money either way. But if you're a true exploration company in this country, when you hear the world words drill baby drill, it falls on deaf ears.

[00:02:57]And the reason it falls on deaf ears is you're saying to yourself, I'm not going to drill baby drill. I'm going to protect my capital. I'm going to protect my partners. I'm going to protect my shareholders. I'm going to maximize my returns like any smart entrepreneur would do in this country. Drill, baby, drill. It might as well be dead on arrival. It's not going to happen. In fact, if you look at the rig count, the active drilling rig count since the beginning of March when the war broke out to now, we're actually down rigs.

[00:03:25]oil companies would rather lay down rigs as prices increase because we are now starting to see diesel fuel ser charges going in. We're going to start seeing some push back by service companies going to try to take advantage of higher oil price and ask for more. We don't have the crews, we don't have the equipment, we don't have the pipe, we don't have the wellheads, we don't have the tanks. We've been in an industry that's been starved at capital for 15 to 20 years. And now all of a sudden there's an emergency around the globe.

[00:03:48]200 vessels heading across the ocean to come pick up oil out of the United States. Well, where are we going to get the oil from? We're down 350 million barrels out of our strategic petroleum reserves. Somebody needs to wake up and understand the only way to get the oil gas industry in this country to drill more wells for more oil production for more supply to maybe help with a global shortage because of this Iranian war.

[00:04:10]And the only way we're going to do it under any condition, whether there's a war or not, is you've got to pay us a fair price. And I'm sorry that the politicians have told you you deserve $2.50 that gasoline. That's not a reality. I'm sorry that all your congressmen, everybody else are ignorant of the oil only gas industry. I'm sorry you've been promised as a consumer.

[00:04:28]You're you're due a price below $5 a gallon. What you're do is the very best oil, the most reliable energy source in the world, the most consistent, transparent, deliverable, accessible oil in the world, which the United States has. We're the number one oil producer.

[00:04:44]But the people that produce it have to make money, and the people that produce it have to garnish it. Let me just give you one simple example. If the oil industry set the prices, which everyone believes that's true, we set the oil prices because we're just greedy oil and gas people, right? The truth is, would we ever let oil get below a level that causes us to make a profit? Would we have ever let oil trade at a negative $37 a barrel in 2020? Never. We never would have. We would never let it go below $75, $85 a barrel if we believe that's our break even price. But somehow the consumer's been taught and trained by all these so-called pundits that when oil gets to 110, $120, $150 a barrel, the only gas industry, they're starving us. They're keeping back production and keeping back supply. And they're denying us access to supply and refined goods so that way they can make billions of dollars in profit. If that were true, we'd never let it go to a negative. We'd never let it go below break even. We'd never let it go below a profitable margin for all of us. The traders in the world trade according to demand to the consumer. Manufacturing, refinery, transportation, mining, etc. The market dictates our price. So, drill baby drill doesn't work right. It means dead on arrival. That's a better acronym for it.

[00:06:01]Thanks for listening.