While extremely low gas prices are great for consumers, negative oil prices threaten U.S. oil production and the American jobs that go with it, and that industry can't be allowed to fail, Energy Secretary Dan Brouillette tells Newsmax TV.
"While no one is going to sit here and argue for $300-a-barrel oil, it's important that these companies remain profitable throughout this pandemic so that when we get to the other side of it, that we all enjoy the tremendous econoomic boom that we expect to come, they are going to be part of it as well," Brouillette said Tuesday on "The Chris Salcedo Show."
The oil industry underpins much of the rest of our national economy, he noted, so it will be part of the recovery.
Asked about Russia and OPEC nations conspiring to drive down the price of oil, thus forcing American producers out of the market and ending American energy independence, Brouillette said President Donald Trump has been clear he will use every option available to protect U.S. markets to protect and energy producers.
"The president has taken nothing off the table," he said.
In the interim, Trump has told him to take more oil into the strategic reserve, Brouillette said.
"Demand curves fall much much faster, and they go up much much faster than our ability to keep the part of production in line with demand," he said. "So what's typically happens is on the front end of this when demand goes down we have the overproduction situation that we have now creating a glut which creates a premium for storage.
"But on the backside of this if we're not careful when this economy kicks off again and the demand curve shoots up. If our producers are not there to meet the demand we're all going to be facing very high prices at the gas pump."
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