Energy Secretary Rick Perry told world energy leaders Wednesday that the U.S. will rely on fossil fuels for decades to come, and framed exports of crude oil, natural gas, and coal as a core component of President Trump’s “energy dominance” agenda.
"We are blessed to be in countries with a substantial ability to deliver the people of the globe a better quality of life through fossil fuels,” Perry said during an energy-focused panel at the World Economic Forum in Davos, Switzerland.
Joining Perry on the panel were Saudi Arabia Energy Minister Khalid al-Falih and Russian Energy Minister Alexander Novak.
Combined, the three countries represent more than one-third of global oil production.
The U.S. is anticipated to experience "explosive growth" in oil production in 2018 and will surpass Saudi Arabia's output for the first time, the International Energy Agency reported this month. The U.S. is expected to reach a historic high above 10 million barrels of oil production per day, an amount that would overtake Saudi Arabia and rival Russian oil production.
The U.S. is already the world’s top natural gas producer, thanks to the shale boom.
Energy experts have speculated the historic surge in U.S. output could spoil an agreement between OPEC and non-OPEC nations, such as Russia, to curtail production to drive up global oil prices.
Perry, on Wednesday, downplayed those concerns to the Saudi and Russian energy leaders.
“I don't particularly think it is going to be a spoiler, the American shale production,” Perry said. “I don't get too spun up that the world economy cannot absorb what we are producing globally. We have a bit of a surplus. But feast is better than famine.”
Saudi Arabia's al-Falih said he is not concerned about the threat from U.S. shale, citing rising global demand.
“For the U.S. to regain and even to exceed some of its market share in a much bigger market doesn’t necessarily present a threat to other producers,” al-Falih said, predicting world oil demand will hit 125 million barrels a day in coming years. It's currently at about 100 million barrels.
He said he expects OPEC and non-OPEC countries to continue their production cuts through 2018.
Novak, the Russian energy minister, made a similar commitment.
“This tool is efficient, it works, and it can be used in the future,” he said of the production cut deal. “We should not be afraid of shale oil production in general. Even if we consider shale oil production, the overall balance is positive. We can see the demand exceeds supply, even during the winter period.”
Perry, meanwhile, boasted that the U.S. is pursuing reductions in emissions of carbon dioxide, despite intending to leave the Paris climate change agreement that all other nations are a part of.
“The United States is leading the world in reduction of emissions,” Perry said. “You can have economic growth, improved quality of life, and at the same time drive down emissions. The driving force is the transition from old, inefficient power plants to cleaner burning natural gas. That is what we want to be a part of, and what the fossil fuel industry wants to be a part of.”
But Perry also expressed support for technologies that could displace fossil fuels, such as electric vehicles and battery storage, which can hold excess renewable energy when the sun isn’t shining, and wind is not blowing.
“Are electric cars a good thing, and will you see lot of focus on the development of them?” Perry said. “Absolutely. Certainly, the U.S. will be deeply involved in the development of electric.”
“Battery storage to me is the most intriguing [innovation] to me,” Perry added. “It is truly the holy grail here.”
Perry closed his appearance by attempting to translate what defines Trump's “America first” agenda.
“One of the things people are interested in is when the administration talks ‘America first,’ what does that mean,” Perry said. “It’s simple. The United States wants to be competitive. When your country is looking for a place to purchase [liquefied natural gas], we want you to think about America first.”