With the shutting down of natural gas pipelines in the US and EU, Chevron CEO Mike Wirth warns of a natural gas shortage.
Mr. Wirth thinks consumers in the United States should be prepared for a shock when they get home heating bills this winter.
He told CNN’s Poppy Harlow that “there’s certainly a risk that costs will go up” for American consumers.
“Prices already are very high relative to history and relative to the rest of the world. We’re already seeing this impact being felt in the European economy, and I do think it’s likely that Europe goes into a recession,” Wirth said.
Natural gas prices could go “significantly higher” this winter in the United States.
MORE SUPPLY, NOT TAXES
Wirth called for increased supply to keep prices down, not so-called windfall taxes.
“If you increase taxes on the industry, that does not incentivize investment, it discourages investment. And that’s a simple economic truth,” Wirth said. “We work around the world and our capital is mobile. And so a windfall profits tax in one country is likely to move that investment somewhere else.”
Wirth expressed concerns about how politicized oil prices have become as well.
He told Harlow he’s had more discussions with the Biden administration lately than he did during the president’s first few months in office. Still, he remains concerned about some of the “sharp rhetoric” from the White House and others in Washington about inflation. He said politicians are not always “well informed about how energy markets really work.”
He agreed that climate change is real, but he also told CNN that the company can only do so much at a time when the world still needs oil.
“We take it very seriously; our objective is to deliver lower carbon energy to supply a growing economy. We also need to keep the economy running. And I think the instability we’re seeing in certain markets around the world today is a signal that is we can’t count on tomorrow’s energy system until it’s built,” Wirth said.