US energy and interior secretaries met executives amid market turmoil
Energy executives from the United States and Venezuela met with U.S. Energy Sec. Chris Wright, Interior Sec. Doug Burgum on Sunday in Houston to discuss everything from increasing domestic oil production?to Venezuelan opportunities. This was during the worst?supply interruption in history due to U.S. and Israeli war against Iran.
The dinner meeting was held on the eve if the annual CERAWeek conference where oil ministers, executives from'major energy companies' and members of 'Organization of Petroleum Exporting Countries (OPEC) gather to discuss the current state of the energy industry.
Oil prices are at multi-year highs of $100 per barrel, after Iran effectively closed down the Strait of Hormuz. This is the main trade route that accounts for 20% of all oil and gas in the world.
The attacks on the energy infrastructure have left a long-lasting damage. Even if the Strait is reopened, it may be many years before the supply levels return to the pre-war level.
"We discussed oil and gas markets?and speculation was made on how long this strait might be closed. No one could agree on the length of time this would last. This is the most disruptive and unusual energy market period in history. Bob Dudley is the former CEO of BP and Chairman?of Oil and Gas Climate Initiative.
Dudley said that the two U.S. officials "basically tried to make their case": "'This is why, Venezuela to Iran, we need your help, and these and these and this, from Venezuela to Iran'." "But the U.S. will do what is necessary, whether or not Europeans help."
Secretary Wright?reported to reporters that energy was discussed but declined to elaborate. An official in the administration, who refused to speak on record, stated that the possibility of increasing U.S. oil output was also discussed.
The Sunday dinner at The Grove in downtown Houston is a conference tradition. It brings together the top leaders of the oil industry. In the past, this has included energy ministers and shale executives from OPEC.
The gathering this year was not limited to leaders in the oil industry. It included executives from coal and power companies, highlighting the importance of "power generation" as data center demand explodes.
Among those attending were Toby Neugebauer (co-founder and CEO, power company Fermi America), Ernie Thrasher (CEO, Xcoal), and Lorenzo Simonelli (CEO, oilfield services firm Baker Hughes).
Even after Donald Trump, the U.S. president, said on Friday that he might consider reducing operations in the war against?Iran, it has not slowed down. Trump announced 'on Saturday that the U.S. will attack Iranian power stations if the Strait does not open within 48 hours.
Iran warned that it would strike Gulf energy systems, water treatment facilities and other targets if such an action were taken.
U.S. gas prices are approaching $4 per gallon and have increased by nearly 30% since the beginning of the war at the end February. This could be a problem for Trump as he prepares to face the mid-term election in November. Diesel prices are now over $5 per gallon.
After the dinner, Xcoal's?Thrasher said: "I believe there is a huge?effort to minimize the destruction of the?infrastructure. But no one knows the final result."
"My biggest takeaway is that we are in a volatile time. There is uncertainty and a lot to deal with, but I am confident there is a way through these challenges. But there is no easy fix." Reporting by Arathy S. Somasekhar and Nathan Crooks in Houston; Writing by Liz Hampton, Editing by Sonali P.
(source: Reuters)
