WEBVTT - Surveillance: U.S. Oil Release with Hochstein 0:00:05.120 --> 0:00:09.200 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane, along 0:00:09.240 --> 0:00:13.200 with Jonathan Ferroll and Lisa Brownowitz Jaily. We bring you 0:00:13.320 --> 0:00:18.600 insight from the best and economics, finance, investment, and international relations. 0:00:18.960 --> 0:00:23.840 Find Bloomberg Surveillance on Apple Podcast, Suncloud, Bloomberg dot Com, 0:00:23.920 --> 0:00:30.560 and of course on the Bloomberg Terminal. We need to 0:00:30.640 --> 0:00:34.879 look at that six dollar gallon of gas in Mammoth Mountain, California, 0:00:35.200 --> 0:00:38.040 and yacht's cheaper other places, but it is front and 0:00:38.080 --> 0:00:42.920 center for President Biden joining us a gentleman hugely qualified 0:00:43.280 --> 0:00:47.880 on this strange word energy security. Amos Hockstein is Senior 0:00:47.920 --> 0:00:51.199 Adviser of Energy Security at the Department of State and 0:00:51.320 --> 0:00:55.920 joins us today. The thing here, Amos, every time around 0:00:56.080 --> 0:00:59.840 is whip inflation now. And every president has a different path, 0:01:00.320 --> 0:01:04.080 like Jerry Ford to whip inflation now. And you're reading 0:01:04.080 --> 0:01:06.480 a history is the same as mine. This is a 0:01:06.520 --> 0:01:10.160 tough task. What is the first order of business for 0:01:10.280 --> 0:01:13.720 Joe Biden? Well, I think, first of all, good morning 0:01:13.720 --> 0:01:16.200 and thank you for having me on the show. As 0:01:16.240 --> 0:01:20.119 you said before, energy is energy security is a critical issue, 0:01:20.600 --> 0:01:23.920 and I think the President took strong steps yesterday UH 0:01:24.080 --> 0:01:27.679 to address the fallout in the energy markets as a 0:01:27.720 --> 0:01:32.240 result a direct result of the Ukraine War and the invasion, 0:01:32.280 --> 0:01:35.720 the unjust invasion and brutal war that that Putin is 0:01:35.880 --> 0:01:38.600 waging in Ukraine, and that has consequences, as the President 0:01:38.640 --> 0:01:43.080 said yesterday here at home, with rising costs of energy, 0:01:43.160 --> 0:01:46.119 rising costs of oil, which of course translates, as you said, 0:01:46.480 --> 0:01:50.520 into rising costs of gasoline for Americans. So President Biden 0:01:50.560 --> 0:01:54.520 took a strong step yesterday announcing the largest UH SPR 0:01:54.880 --> 0:01:58.320 released these strategic petroleum reserves a million barrels a day 0:01:58.360 --> 0:02:01.480 for the next six months. H and that we've already 0:02:01.520 --> 0:02:04.400 seen prices come down as a result of that announcement. 0:02:05.080 --> 0:02:08.320 That's going to have a major impact in the oil markets, 0:02:08.320 --> 0:02:12.200 and the energy markets are at large. Okay, but Amos, 0:02:12.200 --> 0:02:15.320 what's important here, and this is pizza's security. John. This 0:02:15.440 --> 0:02:18.840 filters down into every product, including a slice of pizza 0:02:19.120 --> 0:02:21.840 at Famiglia in New York. It is up, up, up. 0:02:21.880 --> 0:02:24.320 You're very delicate about the slice of pizza in New 0:02:24.400 --> 0:02:26.440 York Times. I think it's as important as a girl 0:02:26.440 --> 0:02:29.400 on the gas. I agree, it's important. There's another measure, Amos, 0:02:29.400 --> 0:02:31.920 that you've announced yesterday, you called on Congress to do 0:02:32.040 --> 0:02:34.520 something to make companies pay fees on wows from their 0:02:34.600 --> 0:02:37.320 leases that they haven't used in years, and on acres 0:02:37.320 --> 0:02:40.400 of public lands that they are hoarding without producing. As 0:02:40.440 --> 0:02:42.880 from the statement from the White House release yesterday, the 0:02:42.919 --> 0:02:47.120 Administration keeps talking about these nine thousand leases, Amos. I 0:02:47.160 --> 0:02:49.200 don't think if you wrote this, you would have written that, 0:02:49.720 --> 0:02:51.720 because if I asked you the following question, I want 0:02:51.720 --> 0:02:54.519 a direct answer to a direct question of those nine 0:02:54.600 --> 0:02:58.240 thousand leases, how many of those sit on productive land? 0:02:59.600 --> 0:03:01.640 So I will answer you a direct answer, but let 0:03:01.680 --> 0:03:05.080 me just say on a slice of pizza price, I agree, 0:03:05.480 --> 0:03:07.720 the prices are going up everywhere. Part of that is. 0:03:08.040 --> 0:03:10.960 Part of that is as a result of these skyrockety 0:03:11.040 --> 0:03:15.079 energy prices where we're not a farm to table economy, 0:03:15.080 --> 0:03:17.000 we're a farm to truck to table. So everything that 0:03:17.040 --> 0:03:21.200 we consume has to go on as a result, has 0:03:21.240 --> 0:03:24.360 resulted in a gallon of gasoline or a gallon diesel 0:03:24.960 --> 0:03:28.480 trucks coming criss crossing the country for for delivering whether 0:03:28.560 --> 0:03:32.119 it's ingredients for pizza or if it's for other commodities. 0:03:32.320 --> 0:03:34.960 So there's a direct result, and that's why it's not 0:03:35.080 --> 0:03:38.440 just uh, the gallon gasoline is not a political issue. 0:03:38.440 --> 0:03:41.080 This is a real economic issue that we need to 0:03:41.640 --> 0:03:43.840 we need to address and that is a result of 0:03:43.840 --> 0:03:47.160 a foreign war that we have to be cognizant of. 0:03:47.800 --> 0:03:50.880 As far as the leases look, we these are these 0:03:50.880 --> 0:03:53.400 are in public lands. And your point is right. If 0:03:53.560 --> 0:03:58.640 some of these leases are on uh, nonproductive acreage, then 0:03:59.120 --> 0:04:02.800 the companies that are holding these leases for several years 0:04:02.840 --> 0:04:06.280 sometimes UH and are not doing any seismic, not doing 0:04:06.560 --> 0:04:08.000 the kind of work that needs to be done on 0:04:08.040 --> 0:04:11.480 those on that acreage because there they think it's non productive. 0:04:11.920 --> 0:04:14.440 Then you have two choices. Either you can return the 0:04:14.520 --> 0:04:18.320 lease or give it up, or you can simply pay 0:04:18.360 --> 0:04:20.240 the higher fees because you want to hold onto that 0:04:20.279 --> 0:04:22.680 lease for a little longer um so that you can 0:04:22.720 --> 0:04:25.880 develop it later. Uh. And I think that so that 0:04:26.080 --> 0:04:28.880 is I would have written that any less, you know 0:04:28.880 --> 0:04:30.480 why they might want to sit on it and develop 0:04:30.520 --> 0:04:32.440 it later. It could be on third rate land that 0:04:32.480 --> 0:04:34.960 requires a higher crude price. You know how this works. 0:04:35.320 --> 0:04:38.320 The way this is being framed by the administration is 0:04:38.360 --> 0:04:41.240 that these land leases are being hoarded that were sitting 0:04:41.240 --> 0:04:43.960 on productive land and it's not being produced because these 0:04:44.279 --> 0:04:46.720 companies agreedy. I mean, I'll read the line out from 0:04:46.720 --> 0:04:50.279 the President his words, companies have an obligation that goes 0:04:50.320 --> 0:04:52.960 beyond just the shareholders, to their customers, their communities in 0:04:53.000 --> 0:04:55.719 their country. No American company should take advantage of a 0:04:55.720 --> 0:04:58.800 pandemic or putin to enrich themselves at the expense of 0:04:58.839 --> 0:05:03.960 American families. What evidence is that that they're holding those releases? Why, 0:05:04.040 --> 0:05:05.520 I'll finished, then you can go, and I'll give you 0:05:05.520 --> 0:05:07.919 all the time you need. What evidence is that that 0:05:07.960 --> 0:05:12.359 they're holding those leases because they're being greedy to profit 0:05:12.440 --> 0:05:17.120 from what's happening in Ukraine. So so let's disagregate there. 0:05:17.120 --> 0:05:19.640 There are a number of issues here, and the President 0:05:19.680 --> 0:05:25.080 actually recognized the companies, the oil companies that are responding 0:05:25.160 --> 0:05:28.080 to this price environment, that are responding to this world 0:05:28.120 --> 0:05:32.160 supply shortage that we're in and have announced extraordinary increases 0:05:32.200 --> 0:05:36.440 in capex uh and in reinvestment in the United States 0:05:36.880 --> 0:05:40.599 in bringing on additional production. And he's recognized him and 0:05:40.640 --> 0:05:42.719 said that was a that is progress and he and 0:05:42.720 --> 0:05:45.600 he praised them for doing that. But there are other companies, 0:05:45.600 --> 0:05:48.400 and you know that, Jonathan, that are saying, look, I 0:05:48.480 --> 0:05:52.480 have the ability to increase production with prices at prices 0:05:52.480 --> 0:05:53.880 were at a hundred and twenty and a hundred and 0:05:53.960 --> 0:05:56.680 thirty just just a week ago, and said I'm not 0:05:56.720 --> 0:05:58.800 gonna do it. And he called out some of those 0:05:58.839 --> 0:06:01.719 who have said, even at two it or three barrel, 0:06:02.120 --> 0:06:05.560 I'm not going to increase production because a variety of reasons, 0:06:05.560 --> 0:06:08.320 and some of them are saying, my, my, the funds 0:06:08.400 --> 0:06:11.000 that back me or that owned my that my my 0:06:11.040 --> 0:06:15.559 shareholders or my uh my holders of my debt are saying, 0:06:15.640 --> 0:06:18.760 don't do that. Give us increased dividends during this time. 0:06:18.839 --> 0:06:22.760 There is no well that is not profitable at a 0:06:22.960 --> 0:06:25.159 d and twenty a hundred and thirty. And if you're 0:06:25.160 --> 0:06:29.000 making a decision at prolonged period of time of above 0:06:29.080 --> 0:06:31.920 eighty five dollars, which we've now been in for for 0:06:31.960 --> 0:06:35.120 a few months, that you can't make more investment to 0:06:35.160 --> 0:06:38.280 bring on production than I think the President is right 0:06:38.839 --> 0:06:42.200 to call them out, especially when other companies are saying, no, 0:06:42.360 --> 0:06:44.600 this is the kind of exactly the kind of environment 0:06:44.960 --> 0:06:47.320 that we're that we are going to increase production. And look, 0:06:47.320 --> 0:06:49.600 we did two things. One the President announced that we're 0:06:49.640 --> 0:06:52.000 going to release a million barrels a day in order 0:06:52.000 --> 0:06:54.800 to increase the certainty of liquidity in the in the 0:06:54.880 --> 0:06:57.280 energy markets and to make sure there's enough oil on 0:06:57.320 --> 0:07:00.120 the market to support the U S economy as all 0:07:00.120 --> 0:07:02.800 as the global coming number two. He has said that 0:07:02.839 --> 0:07:06.960 we're going to replenish the reserve at a time when 0:07:07.000 --> 0:07:10.960 we finished dispersing and releasing the oil and when prices 0:07:11.000 --> 0:07:13.200 come down, So we're gonna sell the oil now at 0:07:13.280 --> 0:07:17.640 high prices buy it back later. That gives incentive to 0:07:17.800 --> 0:07:21.080 the oil companies to say, look, I know that even 0:07:21.080 --> 0:07:23.800 though the US is going to release these reserves, I'm 0:07:23.800 --> 0:07:25.920 going to have a buyer in the US government later on. 0:07:26.240 --> 0:07:30.320 So it continues that incentive to increase production. And I 0:07:30.360 --> 0:07:32.880 think that this is what we needed. We needed to 0:07:32.920 --> 0:07:36.640 put something into the system where we can bridge The 0:07:36.640 --> 0:07:39.160 oil companies have said, you look at Exxon and Chevron, 0:07:39.280 --> 0:07:42.280 Conoco Oxy have said they're going to increase production. We're 0:07:42.280 --> 0:07:45.080 going to increase nine thousand to a million barrels a 0:07:45.160 --> 0:07:49.000 day this year, and that means but it's only gonna 0:07:49.080 --> 0:07:51.440 come on in the middle of the third quarter to 0:07:51.480 --> 0:07:53.600 the end of the year, So we have a gap 0:07:53.680 --> 0:07:56.120 between now and that period of time. So what the 0:07:56.160 --> 0:07:59.320 President did yesterday. This historic move is to say, I'm 0:07:59.320 --> 0:08:01.240 gonna the US government is going to fill that gap 0:08:01.600 --> 0:08:04.720 between now and there and put that same million barrels 0:08:04.720 --> 0:08:07.400 a day of production that we were hoping to get 0:08:07.440 --> 0:08:08.560 at the end that we're going to get at the 0:08:08.640 --> 0:08:11.120 end of the year, and put that out now so 0:08:11.160 --> 0:08:14.080 that we're not replacing the private sector, We're incentivizing it 0:08:14.280 --> 0:08:18.960 and letting the American consumer benefit from lower prices between 0:08:19.000 --> 0:08:21.640 now and there. They likes the Goldmen, Sex disagree. Jeff 0:08:21.680 --> 0:08:24.680 Curry says this the U S policy, use of an 0:08:24.760 --> 0:08:28.520 SPR release, a potential deal with Iran, extreme price volatility, 0:08:28.600 --> 0:08:30.680 and the growing risk of a recession next year are 0:08:30.680 --> 0:08:34.920 all exacerbating the uncertainty face by producers, reducing their incentive 0:08:35.000 --> 0:08:37.480 to invest more. And What's the reason I bring this 0:08:37.480 --> 0:08:40.800 stuff up is that I want to avoid this really 0:08:41.600 --> 0:08:44.839 kind of simplistic conversation that something untoward is happening in 0:08:44.880 --> 0:08:46.880 the oil patch when you know that what happens in 0:08:46.880 --> 0:08:51.959 the oil industry is incredibly complex. Now you've said something 0:08:51.960 --> 0:08:54.000 else over the last few years as well, over the 0:08:54.040 --> 0:08:57.280 last twelve months. I'll bring up another thing. This was November. 0:08:58.280 --> 0:09:02.120 President Biden urged the FTC Commission share to investigate oil 0:09:02.120 --> 0:09:05.480 and gas companies retail prices, blaming industry leaders. As gas 0:09:05.480 --> 0:09:09.320 prices continue to saw, it's become this talking point the 0:09:09.400 --> 0:09:12.160 oil majors are hoarding these leases, even though you admit, 0:09:12.240 --> 0:09:15.000 we don't know what's on that acreage. We don't know 0:09:15.040 --> 0:09:18.000 what's on that acorage. Then there's this other talking point 0:09:18.000 --> 0:09:20.960 that somehow these companies are price couching and in the 0:09:21.000 --> 0:09:24.599 President's words, taking advantage of a pandemic or putin to 0:09:24.760 --> 0:09:27.720 enrich themselves at the expense of American families. I'm just 0:09:27.800 --> 0:09:30.800 asking what evidences they're off that you wanted to start 0:09:30.840 --> 0:09:32.800 this probe. What have you found, What evidence is that 0:09:32.920 --> 0:09:35.760 what companies are price couching right now? And if you 0:09:35.800 --> 0:09:38.320 can identify them and the name them, what are you 0:09:38.320 --> 0:09:42.400 doing about it? Well, first, I think, as we said yesterday, 0:09:42.400 --> 0:09:46.439 I don't believe person all to Mr Curry's comments. Uh. 0:09:46.520 --> 0:09:49.199 I've i in my colleagues and the US government. We've 0:09:49.280 --> 0:09:52.560 been in close contact with the energy industry, and most 0:09:52.559 --> 0:09:55.160 companies have actually said that they believe what we did 0:09:55.240 --> 0:09:58.080 yesterday was exactly the right thing to do, uh, and 0:09:58.120 --> 0:10:02.280 that they feel that it hasn't in sentive because it 0:10:02.400 --> 0:10:05.760 is for six months before their production comes online, and 0:10:05.840 --> 0:10:07.960 because we're going to spend the next couple of years 0:10:07.960 --> 0:10:11.520 replenishing the reserve, that means that they are incentivized to 0:10:11.559 --> 0:10:15.600 continue to spend the capex that they've announced to increase production. 0:10:15.760 --> 0:10:20.520 So with respect to Golden Saxon, I take a lot 0:10:20.559 --> 0:10:21.880 of issue with some of the other things that he 0:10:21.960 --> 0:10:23.920 said in that I have no tag you too. But 0:10:24.120 --> 0:10:26.160 another question you'd be asked as well, Amoss, is who 0:10:26.160 --> 0:10:28.520 would make who would make a decision like this to 0:10:28.640 --> 0:10:33.200 boost capex on front month? Brent Futures, who would do that? 0:10:33.720 --> 0:10:35.640 W c I Futures front month? Who would do that? 0:10:35.679 --> 0:10:37.120 You know what the rest of the curve looks like. 0:10:37.400 --> 0:10:38.959 Why would they make a decision based on where the 0:10:39.000 --> 0:10:42.559 front month is? Well, don't I'll tell you they are 0:10:42.600 --> 0:10:45.679 making that decision. Uh. They have announced that they're going 0:10:45.720 --> 0:10:48.520 to several of the majors who are the largest holders 0:10:48.840 --> 0:10:51.960 and rulers in in the Permian UH and in other 0:10:52.320 --> 0:10:55.080 shale basins, have said that they are increasing cap x. 0:10:55.600 --> 0:11:01.480 I think they're going to increase production. Total US production 0:11:01.520 --> 0:11:03.840 is going to grow by about ten percent by that 0:11:04.000 --> 0:11:07.400 ninod to a million barrels. It's just that these things 0:11:07.480 --> 0:11:10.679 don't happen overnight. You know that the decision to spend 0:11:10.679 --> 0:11:14.040 money billions of dollars to bring up production doesn't mean 0:11:14.080 --> 0:11:16.560 production comes on the next day. But I want to 0:11:16.559 --> 0:11:18.240 address the point that you said, because I think the 0:11:18.240 --> 0:11:21.040 President was very clear there are two We're not taking 0:11:21.080 --> 0:11:23.720 a broad swipe of the whole industry, he said. I 0:11:23.760 --> 0:11:27.520 wanted that he wanted to acknowledge the fact that part 0:11:27.520 --> 0:11:29.600 of the industry has done exactly what it needs to 0:11:29.640 --> 0:11:32.960 do and to see HI old prices incentivizing them to 0:11:33.679 --> 0:11:37.360 bring about more production other companies, and we can't ignore 0:11:37.400 --> 0:11:40.160 this done some companies have said, and the quote that 0:11:40.200 --> 0:11:42.840 he used in his speech that even at two hundred 0:11:42.880 --> 0:11:46.600 dollars of barrel, I will not increase production because of 0:11:47.280 --> 0:11:50.320 uh so called fiscal discipline, that is not I'm not 0:11:50.400 --> 0:11:53.720 making that up there to be fair to you, just 0:11:53.800 --> 0:11:55.600 let me jump in to be fair to you. That 0:11:55.720 --> 0:11:58.320 was a comment on this network. I heard it, I 0:11:58.360 --> 0:12:01.160 talked about it, I repeated it. It's something I've said before. 0:12:01.440 --> 0:12:03.920 Another thing I've highlighted as well was a Wall Street 0:12:04.000 --> 0:12:06.000 Journal report that came out in the last few weeks, 0:12:06.240 --> 0:12:08.840 the administration is trying to make a call to the 0:12:08.840 --> 0:12:11.240 Saudiast and read trying to arrange a call with the 0:12:11.240 --> 0:12:13.880 Crown Prince Mohammad have been Salman and they won't take 0:12:13.920 --> 0:12:16.840 the call. Now, I spoke to a member of OPEC, 0:12:16.960 --> 0:12:18.520 and you can respond to that in a moment. I 0:12:18.520 --> 0:12:20.680 spoke to a member of OPEC this week, and I 0:12:20.679 --> 0:12:23.280 thought it was utterly embarrassing for them that they had 0:12:23.280 --> 0:12:26.000 a meeting earlier this month that lasted thirteen minutes, and 0:12:26.120 --> 0:12:29.240 one just yesterday there was one minute shorter. Now, I 0:12:29.280 --> 0:12:31.880 wonder if it's more embarrassing for us that they're laughing 0:12:31.880 --> 0:12:34.240 in our faces and doing this. Now you speak to 0:12:34.280 --> 0:12:38.000 the Saudiast, talk to me about it. A. Is that false? 0:12:38.880 --> 0:12:42.160 Did the administration trying to arrange a call with Crown 0:12:42.200 --> 0:12:44.000 Prince Mohammad been some man and the President of the 0:12:44.080 --> 0:12:47.920 United States? And B why are their meetings last thing 0:12:48.040 --> 0:12:54.120 thirteen minutes if we're in a massive energy crisis. So one, 0:12:54.640 --> 0:12:56.400 there was a call that was going to be arranged 0:12:56.440 --> 0:12:59.959 between the President and King's onmone and that called did 0:13:00.000 --> 0:13:04.280 take place. Nobody that those reports I'm seeing constantly reports 0:13:04.280 --> 0:13:07.600 of Saudi snubbing the US or I think there's an 0:13:07.640 --> 0:13:12.040 interest in in certain quarters UH to to bring about 0:13:12.080 --> 0:13:15.840 this kind of narrative that is completely false. I was inside. 0:13:15.840 --> 0:13:17.679 I've been to Saudi Arabia on a number of occasions 0:13:17.720 --> 0:13:20.280 over the last several weeks, on a couple of months, 0:13:20.960 --> 0:13:23.160 on a couple of occasions, I was told what the 0:13:23.160 --> 0:13:25.560 Saudis told me on the front pages of the news 0:13:25.600 --> 0:13:29.800 of a US newspaper about three hours before the meeting started, UH, 0:13:29.840 --> 0:13:31.840 and I showed this out. He's the headline, so that 0:13:31.920 --> 0:13:35.719 we can jointly comment about the the hyperbole of the 0:13:35.760 --> 0:13:38.200 press on this. So I would really relax. I don't 0:13:38.200 --> 0:13:40.760 think there's any relationship between the United States and Saudi 0:13:40.840 --> 0:13:43.280 is strategic. We have a lot of issues that we 0:13:43.320 --> 0:13:46.120 need to work on together. UH. There are complexities in 0:13:46.120 --> 0:13:49.160 that relationship that we are working on. We have a 0:13:49.160 --> 0:13:52.920 lot of issues that UH that are of common interest 0:13:53.000 --> 0:13:56.640 fighting terrorism UH that Saudi has had to suffer through 0:13:56.640 --> 0:13:59.720 over the last several weeks, specifically from the houthies. We 0:13:59.800 --> 0:14:02.640 are a lot of strategic interests elsewhere in the region 0:14:02.800 --> 0:14:05.040 and as well on energy, and I'll tell you that 0:14:05.160 --> 0:14:08.520 we're having very good discussions there the press and reality 0:14:08.960 --> 0:14:12.680 on this one are are really far apart. On OPEC. Look, 0:14:15.040 --> 0:14:16.880 I was asked before the OPEC meeting if we had 0:14:16.880 --> 0:14:18.840 a message to OPEC, and my answer was, I have 0:14:18.920 --> 0:14:21.080 no message for ROPE. But these are folks that know 0:14:21.240 --> 0:14:24.160 the industry, they know the market, they know the supply 0:14:24.200 --> 0:14:29.120 and demand. I must have a h difference of opinion. Uh, 0:14:29.280 --> 0:14:31.720 we believe that, not just believe, but I can see 0:14:31.720 --> 0:14:34.360 the physical evidence that the market is short about two 0:14:34.360 --> 0:14:38.000 million barrels a day if not more from Russian supplies 0:14:38.000 --> 0:14:40.480 into the global market. That is that is clear to me. 0:14:41.360 --> 0:14:44.920 We can see that. Obviously, some perhaps an OPEC, don't 0:14:44.920 --> 0:14:47.560 see the shortage of supply, but I can understand that 0:14:47.600 --> 0:14:50.920 it's a complex issue for them with the OPEC versus 0:14:50.920 --> 0:14:54.320 OPEC plus I think that that's uh, they're gonna have 0:14:54.400 --> 0:14:57.280 to take some time and perhaps if you're not going 0:14:57.320 --> 0:15:00.920 to discuss the issues very seriously, UM, perhaps eleven or 0:15:00.920 --> 0:15:03.160 twelve minutes is all you need. But at the end 0:15:03.200 --> 0:15:05.280 of the day, they've they've done what they needed to do, 0:15:05.360 --> 0:15:08.520 and UH they've increased production by announced that they're going 0:15:08.520 --> 0:15:11.600 to continue the increases of production. We don't think that's right. 0:15:11.920 --> 0:15:14.240 The President is not asking other people to do the 0:15:14.320 --> 0:15:17.480 work that we should do. He took action yesterday by 0:15:17.560 --> 0:15:20.720 himself on behalf of the US government for the American 0:15:20.720 --> 0:15:23.160 public of releasing a million barrels a day. I believe, 0:15:23.240 --> 0:15:26.280 by the way, Jonathan, that we're going to have additional 0:15:26.320 --> 0:15:30.200 capacity coming online from our allies. Uh, and we the 0:15:30.240 --> 0:15:33.360 President coordinated this release, as he has all other measures 0:15:33.400 --> 0:15:37.520 against President putin with our allies when he was in 0:15:37.560 --> 0:15:40.400 meetings at the G seven and the NATO summit last week. 0:15:40.960 --> 0:15:44.000 He's discussed it with leaders even earlier this week. We've 0:15:44.040 --> 0:15:47.360 I've had conversation with my counterparts and uh, there's a 0:15:47.360 --> 0:15:51.240 meeting that is going on right now of the i 0:15:51.320 --> 0:15:55.880 e A, the International Energy Agency to look at additional 0:15:55.960 --> 0:15:58.760 releases from the international markets. So we won't just have 0:15:59.120 --> 0:16:01.880 coming on the market United States would rather have well 0:16:01.960 --> 0:16:05.200 coming online to the market in Asia and as well 0:16:05.240 --> 0:16:08.360 as Europe over the next several months. Unless you're a professional, 0:16:08.600 --> 0:16:10.920 you've given us tons of time and that's valuable to me. 0:16:10.960 --> 0:16:13.040 You know that. Thank you very much. I appreciate it. 0:16:13.080 --> 0:16:16.479 Amos hostein there of the US administration on the situation 0:16:16.600 --> 0:16:27.520 right now here are the Secretary of Labor, Our John Pharaoh, 0:16:27.720 --> 0:16:29.440 you want to us now on Bloomberg TV and on 0:16:29.480 --> 0:16:33.880 Bloomberg Radio, US Labor Secretary Moddy Welsh Secretary Welsh, what 0:16:34.000 --> 0:16:36.640 a jobs report? Just fantastic. Most people have come on 0:16:36.640 --> 0:16:39.240 the program this morning with Tom and myself and Lisa 0:16:39.320 --> 0:16:41.760 on Bloomberg Surveymance and on the open of all said, 0:16:42.160 --> 0:16:45.880 it looks great. What are you most infused by looking 0:16:45.920 --> 0:16:48.480 at this? Well, I think one of the things that 0:16:48.480 --> 0:16:50.640 that that I like is we we saw at increase 0:16:50.680 --> 0:16:53.480 in labor participation rate. So one thing we spoke about 0:16:53.520 --> 0:16:56.320 this morning. You know, a good you know, unemployment number low, 0:16:56.680 --> 0:16:59.640 a good strong report, good last three months report, actually 0:16:59.680 --> 0:17:03.000 a good US eleven months report, over four hundred fifty jobs. 0:17:03.360 --> 0:17:06.760 And we think about moving forward into two you know, 0:17:06.800 --> 0:17:08.920 one point six million people still need to return back 0:17:08.920 --> 0:17:11.560 to the workforce. How do we get them those folks 0:17:11.600 --> 0:17:13.320 back to work? How do we make sure that that 0:17:13.800 --> 0:17:17.520 labor participation number goes up? Certainly there's still jobs open 0:17:17.560 --> 0:17:19.439 the United States. That's one of the things I'm not 0:17:19.440 --> 0:17:21.600 taking away from the report. I'm very excited about the report, 0:17:21.840 --> 0:17:23.760 but but I think we're thinking about here, how do 0:17:23.800 --> 0:17:26.440 we move forward. The second thing is we're also looking at, 0:17:26.520 --> 0:17:28.320 you know, what what can be done by Congress. We 0:17:28.359 --> 0:17:32.080 have the Bipodisan Innovation Act other known as the CHIPS Bill, 0:17:32.320 --> 0:17:35.240 that allows us opportunity for supply chain issues moving forward. 0:17:35.680 --> 0:17:38.960 We have some COVID relief money still being talked about 0:17:38.760 --> 0:17:40.800 it at up a Capitol Hill. They need to pass 0:17:40.840 --> 0:17:42.920 that because we need to. We're watching I'm seeing what's 0:17:42.920 --> 0:17:45.080 going on in China and parts of Europe with another 0:17:45.160 --> 0:17:47.160 variant going up. We want to make sure that we're 0:17:47.160 --> 0:17:49.119 prepared for that here in the United States. Uh And 0:17:49.160 --> 0:17:52.000 then obviously inflation we're working to the President is is 0:17:52.280 --> 0:17:54.800 very lazy focus on bringing the cost down. Lots of 0:17:54.880 --> 0:17:58.360 challenges there. You were just talking about global challenges there 0:17:58.400 --> 0:18:00.240 that we have in other markets. You know, we have 0:18:00.320 --> 0:18:02.680 to you know, continue to work very closely on that. 0:18:02.880 --> 0:18:05.160 You know, the Fed Reserve they're gonna they're gonna take 0:18:05.160 --> 0:18:07.399 their action. I can't really comment on that, but we 0:18:07.440 --> 0:18:09.199 have to we have to make sure that in the 0:18:09.240 --> 0:18:10.840 short term we do I mean we can and reduce 0:18:10.840 --> 0:18:14.119 those prices, but also long term that it doesn't happen again. 0:18:14.160 --> 0:18:16.200 A lot of what we're seeing in inflation is due 0:18:16.240 --> 0:18:19.119 to the pandemic obviously what we're seeing with with Putin 0:18:19.440 --> 0:18:22.200 and what he's doing with Ukraine. But but we also 0:18:22.240 --> 0:18:24.000 have to think long term, how do we prepare the 0:18:24.000 --> 0:18:26.240 country that we don't go through us again it. Secondly, Welsh, 0:18:26.280 --> 0:18:27.720 I've only got a few more minutes with you because 0:18:27.720 --> 0:18:29.320 I know you've got to do a range of interviews. 0:18:29.320 --> 0:18:30.800 You're a busy man this morning, so I went through 0:18:30.840 --> 0:18:33.159 a couple of other issues. There is a labor contract 0:18:33.160 --> 0:18:35.639 covering about twenty two thousand West Coast dock workers at 0:18:35.640 --> 0:18:37.959 sites including l A and Long Beach Ports that expires 0:18:38.040 --> 0:18:39.560 until life. F onest I know you're aware of that. 0:18:40.000 --> 0:18:42.600 I want you to help me understand what's the difference 0:18:42.600 --> 0:18:46.320 between those unions, those individuals behind those groups to represent them, 0:18:46.560 --> 0:18:49.919 using their leverage to secure better terms and exploiting the 0:18:49.920 --> 0:18:53.560 country's dependence on those ports. What's the difference. I don't 0:18:53.560 --> 0:18:55.199 think they'll do that. I mean I was out in 0:18:55.880 --> 0:18:59.440 Seattle and Tacoma in Portland last week specifically to talk 0:18:59.480 --> 0:19:02.679 to the come penny in companies about about the negotiation, 0:19:02.680 --> 0:19:04.719 a little bit about how they feel about it in 0:19:04.800 --> 0:19:07.560 the unions and express the both sides the importance of 0:19:07.880 --> 0:19:10.040 what we've gone through as a nation over the last 0:19:10.160 --> 0:19:13.360 eighteen months with supply chain and challenges and still having 0:19:13.400 --> 0:19:15.760 ships out in the ocean. They all understand the importance 0:19:15.760 --> 0:19:18.000 of that, and I think that I don't. I don't 0:19:18.040 --> 0:19:20.800 see either side exploiting the situation we're living in for 0:19:20.880 --> 0:19:23.720 better wages. The contract will begin negotiation at some point 0:19:23.920 --> 0:19:25.520 in the next month or so. I believe that's when 0:19:25.520 --> 0:19:28.280 it'll start. They have to do some notification piece. But 0:19:28.440 --> 0:19:31.520 I'm going to monitor the situation very closely. Obviously, UM 0:19:31.560 --> 0:19:33.800 I want to make sure that that we we don't 0:19:33.840 --> 0:19:35.560 stop our ports. I mean that the last thing we 0:19:35.600 --> 0:19:37.480 need in this country right now or in this world, 0:19:37.520 --> 0:19:40.840 quite honestly, is shutting down other supply chain and creating 0:19:40.840 --> 0:19:42.879 other supply chain issues. Are you going to step in 0:19:44.000 --> 0:19:45.840 if I need to? I will, I saw, I said 0:19:45.840 --> 0:19:47.040 the both sides. I mean, I don't think I have 0:19:47.040 --> 0:19:49.120 to step in at this point. If I did, I'd 0:19:49.119 --> 0:19:51.360 be having a very different conversation with you. But I think, 0:19:51.400 --> 0:19:55.040 you know, I feel good where the conversation is with 0:19:54.640 --> 0:19:56.959 the with the sides right now. I think that they 0:19:57.000 --> 0:19:59.920 all understand the magnitude of this particular moment. This is 0:20:00.040 --> 0:20:01.919 on like any other moment they've ever had when it 0:20:01.960 --> 0:20:05.359 comes to negotiations. Uh, still in coming out of a pandemic, 0:20:05.400 --> 0:20:07.800 and you know, moving forward all these issues around this. 0:20:07.880 --> 0:20:10.600 So I think they acknowledge very seriously the situation this 0:20:10.640 --> 0:20:12.920 country is in, and quite honestly, I supply chain is in. 0:20:13.080 --> 0:20:14.879 You've been to those ports. You travel a lot. I 0:20:14.920 --> 0:20:17.840 believe it's sixty cities in thirty states during the first year. 0:20:18.000 --> 0:20:20.280 You know where I'm going with this. You've also been 0:20:20.320 --> 0:20:23.280 really criticized because you've spent a hundred and sixty two 0:20:23.359 --> 0:20:25.880 days in Boston out of your first two eight four 0:20:25.960 --> 0:20:28.280 days in office. Second be well, So you know this 0:20:28.359 --> 0:20:31.080 comes up often when you and I talk, keeps coming up, 0:20:31.160 --> 0:20:33.640 People keep talking to me about it. Yeah, I think 0:20:35.359 --> 0:20:38.640