Biden Energy Adviser: Oil Companies Should Invest in Lower-Profit Short-Term Production, We’ll ‘Accelerate the Energy Transition’

On Wednesday’s broadcast of CNBC’s “Squawk Box,” White House Senior Adviser on Energy Security Amos Hochstein argued that oil companies can “invest today in short cycles that will increase production” “instead of trying to lock in more profits” and vowed that the Biden administration is “going to try to accelerate the energy transition.”

Hochstein stated, “We both know that, in the United States, the onshore production are short cycles. They can invest today in short cycles that will increase production. And at these numbers, at these prices, they’re guaranteed to make profits on those investments today. So instead of trying to lock in more profits and to share those with shareholders, which I understand the impulse there, and to buy back shares and to pay higher dividends, I think at this moment in history, I think it’s fair to ask that they invest it today on profits that we know they’re going to get. Maybe they won’t be at $100, maybe they’ll be at 90 or at 80. But we know they’re going to get those profits in the short cycle that is the shale oil production onshore of the United States. And in fact, Joe, the CEOs — some of these CEOs themselves have said, just recently, I mean, Mike Wirth of Chevron said it publicly, that he was going to increase production.”

He added, “What happens in the outer years? Yeah, we’re going to try to accelerate the energy transition.”

Follow Ian Hanchett on Twitter @IanHanchett