Harold Hamm, founder of Continental Resources and a prominent Republican donor, has criticized the Biden administration, stating that it has made the US "unusually vulnerable" to potential oil price shocks from the Middle East. He attributes this vulnerability to the draining of the Strategic Petroleum Reserve (SPR), perceived damage to domestic production, and what he calls bungled foreign policy. Hamm expressed significant concern that Middle East conflicts could disrupt global oil supplies, finding the US shale sector in a "weakened condition" and unable to rapidly increase output. He noted that refinery inventories are also at their lowest in years, comparing the situation to having a car without gas.
Despite Hamm's criticisms, US officials reject his claims, pointing to record-high US oil and gas production under President Biden and soaring crude and LNG exports. They also note that the SPR has been replenished since June 2023, increasing by 10% to 382 million barrels, which is about half of its capacity and enough to meet approximately 19 days of consumption. An official stated that the administration has actively worked to prevent overseas conflicts from negatively impacting Americans by accelerating the energy transition and making strategic SPR releases, successfully navigating predictions of market breakage and $100 oil.
Meanwhile, in a broader economic shift, Big Tech's investment in artificial intelligence (AI) is rapidly approaching and in some areas surpassing the capital expenditure of the entire global oil and gas industry. Major tech firms like Amazon, Alphabet, Microsoft, and Meta are projected to spend nearly $700 billion combined in 2026 on AI-related infrastructure, including data centers, semiconductors, and cloud platforms. This figure is nearing the total global upstream oil and gas investment, which is expected to be just under $570 billion in 2025, a 4% decline from the previous year. Upstream oil investment specifically is forecast to fall 6% to around $420 billion in 2025, meaning four tech companies are on track to outspend the entire global oil and gas exploration and production sector.
The oil and gas industry is facing pressure, with upstream investment falling 35% over the past decade from $869 billion in 2015 to $567 billion in 2025. Nearly 90% of current annual upstream investment is dedicated to offsetting production declines rather than increasing supply. This massive tech spending is causing financial strain for some of the most profitable companies, leading them to tap debt markets; for example, Meta and Oracle issued $75 billion in bonds and loans in late 2025 for AI data center construction. The International Energy Agency's Executive Director Fatih Birol noted this fundamental shift, stating that ten years ago fossil fuel investment was higher than electricity investment, but now the opposite is true, although natural gas investment has increased in 2025 due to demand from data centers.
