for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
Barack Obama

Instant View: Judge rules against Obama admin on drilling ban

NEW YORK - A judge on Tuesday ruled against the Obama administration’s six-month moratorium on deepwater drilling in the wake of the oil spill in the Gulf of Mexico.

A lawsuit had been filed by Louisiana-based Hornbeck Offshore Services LLC and was joined by more than a dozen companies involved in offshore drilling operations to reverse the drilling ban imposed by the U.S. Department of Interior.

The White House plans to appeal the ruling immediately.

ANALYST COMMENTS

ROGER READ, ANALYST WITH NATIXIS BLEICHROEDER IN HOUSTON

“It is clearly a positive and would indicate that in the view of the court system, the president overstepped his executive authority.

“It may not matter in that the MMS is the organization that ultimately runs the operating process.

“The judge could overturn the ban, but that may not mean that we get new permits.

“Just because he said ‘No, you cant have a ban’ doesn’t mean we’re back to business.”

KYLE COOPER, MANAGING DIRECTOR, IAF ADVISORS, HOUSTON

“I’m not a lawyer, but it does maybe reaffirm some hope that the government can’t just simply come in and do things willy-nilly without some consideration of the impact. I’m sure they’ll appeal it and very possibly fight it all the way to the Supreme Court.”

PHIL WEISS, ANALYST AT ARGUS RESEARCH, NEW YORK CITY

“In the short tern, I think it won’t do much. From a financial standpoint, I can’t imagine they would do something that fast. If there’s an appeal, I would think (energy companies) would not be inclined to do a lot ... there’s a lot of cost involved (in restarting drilling operations).”

TOM SCHRADER, MANAGING DIRECTOR, U.S. EQUITY TRADING,

STIFEL NICOLAUS CAPITAL MARKETS, BALTIMORE

“If you’re an offshore driller, this already has and will have a tremendous impact, most of the energy companies with offshore drilling exposure will see some action.

“The judge moved up his timing on it, which was the more interesting part.

“It was pretty apparent that the executive branch had overstepped their bounds, what was unexpected was that he moved up the ruling, which was expected to come out tomorrow.”

ANDY FITZPATRICK, DIRECTOR OF INVESTMENTS AT HINSDALE

ASSOCIATES, IN HINSDALE, ILLINOIS

“The news is a little unexpected, and it is going to have some effect in terms of what’s been going on in the Gulf. This is likely to be a benefit for the market and it will be better for the oil companies. The ban definitely created some negative pressure, and the good thing is that it didn’t last long enough for the companies to feel any real deterioration on their balance sheets.”

STEPHEN SCHORK, PRESIDENT AT THE SCHORK GROUP IN VILLANOVA,

PENNSYLVANIA

“I think it is a relief for the market. I understand this ruling can still be overturned, but for the moment I would suspect that it will lessen fears regarding supply and therefore weigh upon energy prices.”

CHRIS JARVIS, SENIOR ANALYST, CAPROCK RISK MANAGEMENT,

HAMPTON FALLS, NEW HAMPSHIRE:

“Today’s ruling against the moratorium should be a positive for offshore drillers and service providers. In our opinion, it was the right decision by the judge as we viewed the moratorium as overdone and inappropriate considering the U.S. dependence on foreign oil.”

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up