Chevron CEO: Oil market is still ‘pretty well supplied’
Chevron chairman and CEO Michael Wirth has said that following the killing of Iran’s top general in a US airstrike, the oil market continues to be “pretty well supplied.”
Wirth was being interviewed by CNBC’s Brian Sullivan on CNBC’s “Squawk on the Street” today at Goldman Sachs’ annual Goldman Energy Conference in Miami Beach, Florida.
Sullivan had asked Wirth if he was surprised the oil price had not increased more than it had.
According to the CNBC exclusive interview’s unofficial transcript sent to US and Global News by NBCUniversal, whose television arm – NBCUniversal Broadcast, Cable, Sports and News – owns CNBC, Wirth replied, “Not really. You know, we saw the attack last year on critical infrastructure in Saudi Arabia. And pretty quickly, the market reverted to areas — a price range where it had been before.”
The Chevron board chairman then said we are still in a well-supplied market.
“And this event [the killing of Iran’s general], while certainly is newsworthy, didn’t fundamentally strike energy infrastructure or change the supply and demand dynamics in the market,” Wirth added. “So, I think certainly a reminder of the risk that exists in our business. But fundamentally hasn’t shifted supply and command which is really where price gets set up.”
Sullivan took Jim Cramer, who was at the New York Stock Exchange, on the show through video. Cramer also asked if Wirth was surprised at all that the forward curve had not really budged despite the Middle East turmoil.
Wirth replied, “Not really, Jim. You know, fundamentally, supply and demand remain where they were before these incidents. We haven’t seen anything that has actually changed that. Last year we did see something that impacted supply for a period of time, which was attack on infrastructure in Saudi Arabia. Credit to Aramco for a strong recovery and repair of that. But fundamentally, markets while they see the geopolitical risk, I think we’ve been in a well-supplied market for some period of time here and that’s generally what the view continues to be at this point.”
Before Cramer was on the show via video, Sullivan had inquired if Wirth was adjusting his internal estimates on the Brent or WTI Crude price in the future, not only because of what happened on Friday, but also because of the OPEC move and the recent, a-little-bit firming up of the market over the last couple of weeks.
Wirth had said no.
He’d explained, “I mean, those are the kinds of things we see in this business, and we look at a long-term view really on supply and demand. And we don’t overlay these shorter-term phenomena into our thinking about price and the things that drive investment.”
The full interview of the Chevron CEO can be watched on CNBC’s website, here.
Image credits: Featured image (Chevron headquarters) - Coolcaesar (CC BY-SA 3.0) Michael Wirth's photo - Chevron Corporation (the Leadership page of Chevron's website via the site's Media section)
