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Not Time For Government Intervention In Oil Market, API Leader Says

President and CEO of the American Petroleum Institute Mike Sommers acknowledges this is a hard time for Texas oil producers, but says the industry has proven resilient in past price shocks.

American Petroleum Institute President and CEO Mike Sommers, right, and North America’s Building Trades Unions President Sean McGarvey, left, cut the ribbon on API’s new headquarters Feb. 14 in Washington.

As the oil market is hit hard by fears over the Coronavirus and international price disputes, the Trump Administration is reportedly considering financial aid to American oil producers. 

Houston Public Media’s Energy Reporter Kyra Buckley spoke to Mike Sommers, President and CEO of the oil and gas industry’s largest trade group, the American Petroleum Institute. It represents more than 600 companies, including Conocophillips, Shell, and Halliburton. 

Interview Highlights

Sommers says this is not the time for federal government intervention in the oil and gas markets. Instead, he says the Trump administration should pressure countries that are threatening to flood the market with cheap oil.

“The best thing that the President can do right now is to engage with the leaders of Saudi Arabia and Russia to make sure that these markets are not oversupplied,” Sommers says. “We do not believe that this is time for federal government intervention into the oil and gas markets.” 

Some experts say the current drop in oil prices especially hurts small and mid-size producers in places like the Permian Basin. Sommers agrees. 

“Make no mistake that those are the people that Saudi Arabia and Russia are trying to put out of business,” he says. “They’ve been very concerned and it’s been a stated goal of both countries to eliminate the American Energy Revolution.” 

That revolution has made American consumers and the industry better able to handle price shocks like this one, Sommers says. But he acknowledges right now is a hard time for Texas oil and gas, and some experts say if the price of oil doesn’t rebound soon, it could mean layoffs in Houston and the west Texas oil fields. 

“We don’t want to sugarcoat the reality here. We know that this is a challenging time for the industry and the business community in particular,” Sommers says. “But this industry has proven itself to be very resilient over time. But we don’t think that involving the federal government in some kind of a bailout at this point is the right thing to do for the industry or for the American economy.”

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Kyra Buckley

Kyra Buckley

Energy Reporter

Kyra Buckley is an Energy Reporter with Houston Public Media. Before joining the News 88.7 team she was the Morning Edition Host and a reporter at KUNC in Northern Colorado. She started in public radio in her hometown of Eugene, Oregon where she hosted Weekend Edition and reported for KLCC....

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