Abstract
Drawing on ethnographic research in Houston, Texas, I explore how private equity financiers in the US hydrocarbon industry are empowered to define and take financial risks on our collective behalf. The US shale revolution could not have unfolded without the financial risk‐taking activities of private equity financiers who channeled billions of dollars into US unconventional exploration and production (“fracking”). These financiers are motivated not only by their own capitalist projects but also by feelings of responsibility to take financial risks for the benefit of others. Shedding light on this enigmatic community, I attend to the relatively neglected area of hydrocarbon finance and highlight how perceptions of financial risk and responsibility become entangled to shape our collective energy present(s) and future(s). As an essential piece of the financial infrastructure that connects investors around the world with US hydrocarbon activities, I suggest that private equity firms are conduits not only of capital but also of responsibility.
Highlights
Revered by many in US hydrocarbon finance as the “cowboys” of financial risk and reward, private equity (PE) financiers provide a way for institutional investors, such as colleges and pension funds, to invest in companies that are not traded on stock exchanges (Souleles 2017, 2019).1 In the oil and gas sector, PE financiers have played and continue to play a central role in funding the US “shale revolution” through small to medium exploration and production (E&P) companies specializing in unconventional extraction
According to Miyazaki (2013, 92–93), arbitrageurs internalize their role as the “strong individuals” who are “willing to take on risks and responsibility” to seize economic opportunities, provision their own well-being, and usher in free-market reforms for the perceived benefit of the Japanese economy
The accounts of Arthur, Kyle, and others provide an occasion to reflect on how financiers are empowered with the responsibility to define and take risks on our collective behalf through institutional investors
Summary
Drawing on ethnographic research in Houston, Texas, I explore how private equity financiers in the US hydrocarbon industry are empowered to define and take financial risks on our collective behalf. Wood (2016, 2019), has shown that investments in small- to medium-sized oil companies create shared moral horizons between investors and managers These horizons are shaped as much by hopes of future profits as by financial managers’ feelings of “commitment, responsibility and perseverance” (Wood 2019, 83) to be good stewards of capital in the face of financial risks and uncertain economic outcomes. My interlocutors include PE partners, managing directors, bankers, lawyers, accountants, consultants, and engineers engaged in the practice of energy investing and lending (most in senior and leadership positions) They let me into their offices, their homes, and their lives, enabling me to carry out interviews, participate in private industry events, “hang out” with them socially, and observe the oil finance sector from inside its close-knit social circles, which cut across firms. Understanding the people in this enigmatic “petroculture” of financial capitalism and the work they perform is as important as understanding the extractive technologies that produce energy, because the speed and expansiveness by which these extractive technologies are deployed are dependent on how they are capitalized and the financiers who capitalize them (Labban 2008; Wilson, Carlson, and Szeman 2017)
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
