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Summary
- Wright criticizes EU and California’s green energy policies
- EU scales back corporate sustainability laws after pressure
- Occidental exited California due to state regulations, Hollub says
(Reuters) – The world needs to more than double oil production, U.S. Energy Secretary Chris Wright said on Thursday, while criticizing the European Union and the U.S. state of California for wasting money on what he described as inefficient green energy.
In recent years, the World Economic Forum’s discussions on energy have centred on ways to boost lower-carbon policies. But during Wright’s discussion with energy company Occidental’s CEO Vicki Hollub in Davos, they emphasised that the world will depend on oil for decades to come.
Wright said corporate environmental regulations in the European Union posed risks to energy cooperation with the United States.
“These regulations could threaten you (U.S. producers) liability-wise to send gas to Europe,” Wright said. “We’re working with our colleagues here in Europe to remove those barriers.”
The EU requires importers of oil and gas into Europe to monitor and report methane emissions associated with those imports, in a bid to curb emissions of the planet-warming gas.
After months of pressure from companies and governments, the European Union agreed last month to sharply scale back two flagship laws, the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive.
ENERGY-WRONG POLICY
Increased natural gas production and investment in LNG export terminals have put the U.S. in a position to replace Europe’s imports of Russian gas that were slashed after the start of the conflict in Ukraine in 2022, Wright said.
He criticised California’s energy policies, which he said resembled Europe’s.
“If California hadn’t pivoted in an energy-wrong policy…how would the residents of California, what would their quality of life be like?” Wright said.
California produced 300,000 barrels per day of crude in 2024, according to the latest data from the U.S. Energy Information Administration, almost halving from a decade prior. Its production peaked at 1.1 million bpd in 1985, according to EIA data going back to the early 1980s.
Hollub said Occidental exited California because of the state’s regulations. In 2014, Occidental spun off its oil and gas assets in the state into a separately traded company and moved its headquarters from Los Angeles to Houston.
California is isolated from refining centres along the U.S. Gulf Coast and in the Midwest and can see swings in energy prices.
Global oil supply stood at 107.4 million barrels per day last month, according to the International Energy Agency.
Reporting by Stephanie Kelly, Shadia Nasralla, Dmitry Zhdannikov; Editing by Joe Bavier, Kirsten Donovan
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