Again, as a small refrigerated freight carrier, we are getting POUNDED on our fuel bills. I have already asked my drivers to take a 20% pay cut which they obliged. After a 20% increase in insurance foe NO reason, now the fuel! As an example for 5 trucks and 5 refrigerated trailers my weekly fuel is $17,500. Vs $14,000 range. Needless to say rates have not increased accordingly. To make matters worse, shippers/receivers are woefully understaffed making unload time 24/36 hours wait ( mostly unpaid or they give you $250 detention) I am at the point where the juice is no longer worth the squeeze!
Unfortunately, it is only going to get worse. Biden has only been in office for 15 months and has been going after oil and gas in particular, and the economy in general. You probably know this better than I do, but....
Even during Trump's administration, the democrats/left/green were forcing the banks to curtail financing to anything petro - oil and gas. Can't get funds to drill, complete a well, connect a well to the collection grid. There is so little lending available now, that even if the money were to come back instantly - the demand is overrunning the supply (by design) to drive up prices. The intent here is demand destruction - like back in the 70's when you can not afford to drive your vehicles. They want to force all vehicles - even the electrics off the road and for everyone to use public transportation. California is essentially outlawing single-family homes - by removing the zoning and allowing multifamily everywhere to increase density.
Now the Democrats want to tax the "unearned" profits of oil and gas. Returns were low, especially if you need to self-finance - and they are trying to remove any profit from what little there is. Production is declining - which generates the self-financing cash flow.
Pulled/stopped the Canadian pipeline. Is having the Michigan governor halt the operation of one of the pipelines across to Canada. There are 5 pipelines and they are working their best to close one down.
Canada can supply 3x the amount of oil and gas that we are getting from Russia. Biden is making every bbl coming across the border much more expensive.
Pulled drilling permits from federal land leases. Biden has also halted all leases and pulled already leased land back. If you trying to drill on federal land, you are stopped - even if they have not pulled your lease and or permit yet. The bank gets a call and your money is pulled, but you need to repay your sunk costs without any production. Bankruptcy is your only option - and the bank will happily oblige.
Even on private land it use to take a couple of weeks for a permit and a union order for drilling - now it takes over a year - if you are lucky.
I can go on, but it is not pretty and will only get worse.
I have some oil and gas royalty property and I'm certainly not getting rich at $100 oil. Right now ROI is running 6% annually and that's after about half the costs have been applied, and prior to the other half of the costs coming in, but production is waaaay down. This time a year ago at $47 oil (has a 3 month lag - so it was at the end of 2020), ROI was 1.7% In 2019 with $50 oil @ 4.4% return on substantially higher production, and we were both happy campers.
The point that I'm making, is that you are losing your shirt and I'm not really making any bank - but it could be easily fixed by having the government get out of the economy.
We got started in Oil & Gas hauling frac. sand around 2017. We pivoted to refrigerated freight before the election because the writing was on the wall.
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