By Rachel Adams-Heard
Sitton, a Republican who lost the primary election for his own seat on the Texas Railroad Commission just one month ago, said Thursday that he had spoken with Russian Energy Minister Alexander Novak about cutting global oil supplies and planned to have a conversation with Novak’s counterpart in Saudi Arabia. Two weeks ago, he spoke with OPEC Secretary General Mohammad Barkindo and was invited to attend a meeting this summer in Vienna.
To be clear, these kinds of exchanges between state-level regulators and national energy ministers about capping global oil supplies are not common. In fact, if Sitton attends that OPEC meeting, he would be the first member of the state Railroad Commission to do so since the 1980s. He’s earning a seat at the table just as the OPEC+ alliance, which includes Saudi Arabia and Russia, tries to form a global coalition to cut output, put an end to a war over market share and stem the rout in crude prices brought on by the Covid-19 pandemic.
A deal with non-OPEC+ nations including the U.S. would set a historic precedent. President Donald Trump hasn’t publicly said whether the U.S. is willing to cut its own domestic production. He met with oil executives at the White House on Friday to discuss ways to shore up the industry.
In the absence of federal action, Sitton — an oil and gas engineer and self-proclaimed energy markets expert who leaves office in January — became the face of America’s response to a global battle for oil market share.
Even before crude collapsed amid the virus and a Saudi-Russia price war, Sitton was in the public eye far more often than his fellow commissioners, Chairman Wayne Christian and Christi Craddick, both Republicans. He regularly appears on television and has his own website, ryansitton.com, where visitors can view everything from his annual oil industry report to a video of a Crossfit class he led for state employees. (Sitton, 45, attributes his more public persona to success early in his career as a business owner that allowed him to take more risks while in office.)
To a certain degree, Sitton’s always had an eye on the global market. When the commission was criticized for its lax policy toward natural gas flaring, Sitton took it upon himself to release a report and subsequent video call, saying that the problem was far worse in Iraq and Iran.
“Other nations are flaring at levels four times higher than Texas,” he said in the report, which was panned by environmental groups. “They, therefore, present much more efficient paths to global flaring reductions.”
The power to manage the state’s oil production has been there all along. Following a slump in the oil market in 1931, the Texas Railroad Commission started periodically implementing a process known as pro-rationing to bolster prices. That ended in the early 1970s, just as OPEC, which had modeled itself on the commission, was rising to a dominant position in the oil market.
“There’s this regulatory authority that’s just sitting there unused for all these years but all of a sudden becomes relevant again,” said James Coleman, an energy law professor at Southern Methodist University. “The Texas Railroad Commission, although obscure, has always been an important international player.”
Days after prices first crashed below $25 a barrel, Sitton penned an opinion piece advocating for a coordinated response with Saudi Arabia and Russia. He’s urging the agency to consider pro-rationing state production, a proposal that both Christian and Craddick have yet to support. It wouldn’t be the first time Sitton has split with his fellow commissioners: Last year, Craddick nominated Christian to serve as chairman, even though tradition dictated that Sitton would lead the agency as he ended his six-year term.
The commission has scheduled a hearing on pro-rationing for later this month, a move Sitton announced in a webinar he hosted to outline his take on the global oil market.
“Our constituents elect us for situations like this and look at how we solve problems,” he said in an interview last month. “They don’t need people who sit on the sidelines when you’re in an economic catastrophe like we’re in right now.”
It’s a complicated political position to take in Texas, a state that prides itself on free markets and individualism. And Sitton doesn’t appear to have much public support, with the exception of Pioneer Natural Resources Co. and Parsley Energy Inc. Scott Sheffield, chief executive officer of Pioneer, is himself an unusually public figure for the typically media-shy independent shale producers.
Others companies, including Exxon Mobil Corp., and major trade groups like the American Petroleum Institute, have said they’re not seeking government intervention, preferring free markets take their course. And Christian and Craddick both reiterated Friday evening that Sitton’s vocal support for a government response doesn’t necessarily reflect their positions.
“One commissioner does not speak for” the Texas Railroad Commission, Craddick said. “No decision has been made about proration to limit Texas oil production.”
But Sitton may have little to lose. Last month, he lost the Republican primary for his seat in a shocking upset. In November, Jim Wright, a rancher and chief executive of an oilfield-service company, will battle one of two Democrats vying for Sitton’s seat.
Now Sitton could be spending his last few months in state office speaking with international energy chiefs and traveling to Vienna.
“It’s important to remember that this is the history of the Railroad Commission,” Coleman said. “It’s just amazing how quickly this happened.”