Sen. Cruz in The Dallas Morning News: The Best Way to Protect Americas Energy Producers Is to Re-Open the Economy
HOUSTON, Texas - In his new op-ed in the Dallas Morning News, U.S. Sen. Ted Cruz (R-Texas), who has been tapped to join the President's bipartisan task force to re-open the economy, discusses the energy crisis Texans are facing, the impact it is having on the economy, and the importance of helping Texans return safely to work.
As Sen. Cruz writes:
"The best way to protect America's energy industry and the millions of jobs it supports is to help Texans safely return to work and get the economy moving again, increasing energy demand and stabilizing the global marketplace. I'm encouraged to see President Donald Trump and Gov. Greg Abbott are working hard on plans to do just that."
The best way to protect America's energy producers is to re-open the economy
Dallas Morning News
By: Sen. Ted Cruz
April 19, 2020
Texas is currently combating three crises simultaneously.
The COVID-19 outbreak has resulted in a serious public health emergency that has taken the lives of more than 30,000 Americans, according to reporting by The Washington Post. This global pandemic, and the steps taken to protect lives and stop its spread, has also resulted in a catastrophic economic crisis, crushing small businesses and leaving an estimated 22 million Americans out of work.
But these two crises have also caused a third crisis in Texas: an energy crisis. As we work to slow the spread of the coronavirus, flight restrictions have grounded planes and stay-at-home orders have taken many cars off the road, causing the demand for oil to plummet.
To make matters worse, Saudi Arabia and Russia exploited the pandemic to flood the global oil market, drive down prices and drive their competitors - U.S. producers - out of business. In antitrust law, these actions could be considered predatory pricing. And it was nothing short of economic warfare.
The decline in both price and demand created a perfect storm for the energy sector. As the Wall Street Journal put it, "since the new coronavirus hit, the world's thirst for oil has vanished, creating an unprecedented crisis for one of the planet's most powerful industries."
As my friend and energy expert Wil VanLoh explained on my podcast "Verdict" last week, if this perfect storm continues for much longer, many small and independent energy producers will go bankrupt. And once the wells turn off, there may be no turning them back on.
That's not only bad news for the millions of Americans whose livelihoods depend on a vibrant energy sector, it's also bad news for every household in America, as heating our homes, driving our cars, flying on planes and many other aspects of our daily lives will become more expensive.
The consequences for our energy security are dire.
Before this global pandemic ground our booming, blue-collar economy to a halt, the United States had become the No. 1 producer of both oil and natural gas on the planet, surpassing both Russia and Saudi Arabia in crude oil production, and becoming a net exporter of natural gas. Hundreds of thousands of energy innovators and workers in Texas and all throughout the country paved the way for America's energy independence.
Allowing all of our American energy producers to go bankrupt would dramatically turn back the clock on that progress and make the United States more dependent on foreign countries and foreign oil. We can't let that happen.
The best way to protect America's energy industry and the millions of jobs it supports is to help Texans safely return to work and get the economy moving again, increasing energy demand and stabilizing the global marketplace. I'm encouraged to see President Donald Trump and Gov. Greg Abbott are working hard on plans to do just that.
We are working to increase testing of COVID-19 and manufacturing of personal protective equipment so that Americans who are healthy and able can go back to work and so that Texas can systematically begin to re-open our economy. And there are steps we can and must take to help ensure our energy producers survive this storm and come out the other side stronger than ever.
First, we must hold Saudi Arabia and Russia accountable for engaging in predatory pricing during a global pandemic. After several weeks of heated negotiations with those parties, conversations that were as bare-knuckled and candid as any I've participated in with world leaders, we recently reached a deal for them to significantly cut oil production amid this emergency. This is an important first step in addressing the price of oil.
Second, we can make sure America's energy producers have critical access to capital. A few weeks ago, I met with President Trump to ensure banks are not discriminating against energy producers, even as Green New Deal enthusiasts fight to exclude them.
Following that meeting, President Trump directed Energy Secretary and native Texan Dan Brouillette to work with Treasury Secretary Steven Mnuchin to make sure our small and independent energy producers have the same access to emergency relief loans that small business in other industries have to keep their wells on, their doors open and their employees on the payroll.
As the son of parents who owned a small oil services business, I know firsthand how an energy crisis devastated Texas in 1986, when the price of oil collapsed to less than $10 per barrel. The Lone Star State went into a full economic depression. My parents ended up going bankrupt. They lost the company, and we lost our home.
I've felt the fear and uncertainty so many Texans are feeling right now. I'm committed to standing with our energy producers
Once we defeat this pandemic, Americans will return to work. We'll drive our cars and trucks and fly on planes. And when we do, I'm confident energy producers in Texas and across the country will help fuel our economic recovery.
Ted Cruz is a U.S. Senator for Texas. He wrote this column for The Dallas Morning News.