Kent Hance is a longtime politician from West Texas. He has, as he puts it, “a varied background.”
As a state senator, he was the only person ever to beat George W. Bush in an election. He’s also been a congressman, a podcaster and a university chancellor. But it was in 1991, as a departing Texas Railroad commissioner, that he oversaw one of the more surreal footnotes in global energy history.
Despite its name, the Railroad Commission regulates oil and gas in Texas. Hance became a commissioner in the late '80s, during a bad time for the industry.
“When I got appointed, the industry was at the bottom of the barrel," he told KUT in an interview last year. “They were struggling to get by.”
It wasn't just oil and gas that were in trouble.
The entire Texas economy was tanking out. There was the savings and loan banking crisis to contend with, and a huge bust in real estate had left abandoned construction projects scattered across the state.
“They had a lot of see-through buildings,” Hance said. “They were not finished inside.”
In Texas, a lot of the economic wreckage went back to the low price of fossil fuels.
So Hance, as one of the top oil and gas regulators, decided he’d go to the guys who set that price: the Organization of Petroleum Exporting Countries, OPEC.
A Texas oil and gas official sitting down with the international cartel that sets oil prices was a controversial move. The head of the Department of Energy opposed it, as did a lot of Texas politicians.
“I felt like, if I'm a carrot farmer and somebody is setting the price of carrots, I want to know them!” Hance said. “I want to know something about the people in the oil and gas industry that are setting the price, and that was OPEC.”
Hance has a ton of fascinating stories about his visits with influential oil ministers and industry leaders. But this story has to do with a different kind of big name in energy.
It was 1991. Hance was at OPEC headquarters in Vienna, introducing members to his replacement on the Railroad Commission, when he read in the paper that actor Larry Hagman was in town performing in a play.
Hagman was a TV actor famous for his portrayal of scheming Texas oilman J.R. Ewing in the hit series Dallas. And Hance, it turns out, was acquainted with Hagman.
“We called the theater,” he remembered. “And I said 'I'd like for you to see the OPEC people.'"
Hagman said, "Sure!"
That’s how the fictional Dallas character ended up hobnobbing with the power elite of global oil.
“They stood in line a long time to get their picture made with J.R.,” Hance said.
“He had a cowboy hat on. He played the part! The newspapers the next day said ‘JR Meets OPEC,'" he said. "It was hilarious!”
Well, not everyone thought so.
During his talk with the oil ministers, Hagman suggested OPEC raise the price of a barrel of crude to $36 – over double what it was going for at the time.
“Let’s Hope JR Was Joshing,” read an editorial in the Omaha World-Herald. The writers were aghast “given the devastating impact of doubled oil prices on the economies of industrial nations and the Third World.”
Still “the idea was warmly received by the Kuwaiti oil minister,” according to another newspaper report.
Oil didn't break $30 a barrel until about 19 years later. But it did rise by about $4 or $5 by the end of the year, depending on where you were buying.
There's no record of whether Hagman took credit.
The different reactions to Hagman's desire for higher prices, underscore the constant tension between energy-producing regions, like Texas, that benefit from high prices, and energy-consuming ones that don’t.
J.R.’s visit was also a stark illustration of how far the tables had turned when it came to who called the shots in global energy.
From the 1950s until the 1970s it had been the Railroad Commission of Texas that manipulated oil production to fix the price of the commodity.
As U.S. demand for oil grew and domestic production leveled off, the commission lost that influence over oil markets.
By the time Larry Hagman made his visit, Texas still had the swagger. It still had the deep history. It just didn't have the juice.
This story is included in Episode 3 of Season 3 of The Disconnect: Power, Politics and the Texas Blackout. Listen to the full episode in the player above. You can find The Disconnect wherever you get your podcasts.
