The Fuse

Secretary Moniz Hails LNG Exports, Iranian Nuclear Deal, Driverless Cars

by Matt Piotrowski | February 24, 2016

U.S. Secretary of Energy Ernest Moniz spoke to the IHS CERAWeek conference in Houston on Wednesday and held a press conference afterward. Below are the key takeaways.

  • There were loud cheers when Moniz said that Wednesday was a “big day for the natural gas revolution,” as liquefied natural gas (LNG) from the Lower 48 States was exported for the first time. Cheniere announced earlier in the day that the company is now shipping its first volumes of LNG overseas, with the vessel heading to Brazil.
  • When asked by IHS CERAWeek Chairman Daniel Yergin whether the U.S. exporting cargoes of LNG represents a shift in global power, his answer was vague, but he did tout the profound changes both shale oil and gas have had on U.S. energy security.
  • Moniz stated that energy security is a “collective responsibility,” noting, for example, that insecurity in Europe negatively affects the U.S. He pointed out that the U.S. government does not determine the destination of LNG cargoes. That’s up to the companies shipping the LNG. Still, he expects U.S. exports to help bring about more diversity of supply for customers, ultimately improving global energy security.
  • When speaking about the nuclear deal with Iran, Moniz said: “It will block the nuclear weapon threat.”
  • The U.S. still has “very significant issues with Iran and regional behavior” despite the nuclear agreement. Moniz said he hopes the Iranian deal will be an opening to changing U.S.-Iran relationship.
  • The Department of Energy (DOE) is “continuously watching and analyzing” the low oil price situation, but Moniz pointed out that there isn’t much the government can do to help the industry. “Even if we could, I’m not sure it’s a good idea,” he said.
  • Moniz doesn’t expect much impact on the global market from U.S. crude exports. “Price spreads are not there,” he said, pointing out that Light Louisiana Sweet is trading above Brent, making exports uneconomic.
  • Moniz was more enthusiastic when talking about reducing oil demand, and, in turn, oil imports than supply-side developments. The U.S. must continue to push forward three main steps to curb demand: Improve fuel efficiency; develop advanced alternative fuels; and support progress in new technology in transportation, particularly battery-driven cars.
  • Moniz is a big fan of driverless cars, describing himself as very “bullish” on this technology. “I’m not being Pollyannaish,” he said, noting how far this development has come in just the past two years.
  • He believes driverless cars, which are part of “a new paradigm,” have a lot of potential because they are part of a technological trend “that genuinely offers new services to consumers.”