Bloomberg Audio Studios, podcasts, radio news. We do want to stick with energy twenty eight Democratic California lawmakers writing a letter to the Trump administration condemning plans to boost oil drilling along the state's coastline. US Interior Secretary Doug Bergham joins US now Secretary Burgram, thank you so much for
being with us. I want to start with just how important it is right now for the United States to increase energy supplies across the board, not just with drilling, but across the board the face of the demand coming from AI.
Well, good morning, Lisa.
Yes, it's absolutely essential, and this is part of the just announced National Security Plan that the White House has released. That Security plan mentions energy twenty three times. There's an entire section about energy dominance, and folks should think about energy dominance as the ability for the US to sell energy to our friends and allies so they don't have
to buy it from adversary. Is particularly those adversaries that are either funding terrorism or are funding wars, actively funding war machines, and so it's core to the strategy right now. But it's also, as you've talked about on the show, is about with AI because never before in a history have we been able to convert a kill a lot
of electricity into intelligence. The demand for that, regardless of stock prices or stock movements, the demand for AI for intelligence applied to every job, every company, every industry is going to continue to increase the demand for electricity around the world. The US as an energy dominant country, now the largest oil producer in the world, largest LNG exporter
in the world, and growing quickly with that strategy. It bodes well for the future of the US, both in terms of peace and in terms of prosperity.
Secretaire, I'm sure you're aware WTI is under sixty dollars a barrel. What's the impetus for the oil and gas companies in the United States to continue drilling wells at this price level, which potentially could be a loss for them.
Well, I think one thing that we know that in Trump administration, we're cutting red tape so rapidly. We think that, you know, one of the early targets we had was cut ten percent of the cost away from those producers just by cutting red tape. So if you think about, you know, sixty bucks a day might be what sixty seven bucks was a year ago because of our ability to take cost out.
For those producers.
And there's example after example, whether it's from the EPA, the Department of Energy, Department of Interior, where we've been able to help reduce costs. And of course this industry has been better than almost any in terms of gaining you know, productivity. The shale producers now drilling three mile laterals instead of two mile laterals, up to four mile
laterals in many places offshore. We've seen examples overseas of people driving building ten mile laterals when they're getting after the shale rock, all with the same small well pad on the surface. So, you know, great for great for land management, and great for energy production.
And kudos to this industry.
This, the entire shale revolution has occurred through innovation, and that innovation is going to continue, and with AI applied to that, it's going to even get even better. So I see the leading companies are getting their costs down even as demand is going up.
But Baker Hughes is talking about drilling reactivity has fallen sixteen percent since Trump took office this year. The President loves to talk about drill, baby, drill. Do you expect that to change those numbers to change next year.
Well, I think again, I have to take a look at the at the numbers. When we talk about drilling activity. In my home state of North Dakota, we had a number of the well count was going down, but the miles of lateral productive rock could be going up. And so you know, analysts have got to make sure that they're actually keeping up with how fast this industry is changing, because we've got again record production occurring right now and we expect to see records through twenty twenty six.
One area where you have seen price increases has been natural gas. Natural gas prices rising to the highest levels in the US going back to twenty twenty two, and a real question on how much the US can continue to export to places like Europe in the face of significantly higher prices here in.
The United States.
How do you plan to sort of set policy so that the US can be a big exporter to places like Europe while not allowing prices to go up so significantly in the future.
Well, again, the key is its supply and its infrastructure. We have places in the US right now where again there's not one price for gas in America. As you know, I mean, even though we've got the markets and we've got Henry Hub, but we've got we've got.
Widely raging prices.
I mean even in the difference of price in Pennsylvania versus in New England because the lack of natural gas pipelines that have been blocked into places like New England.
And when we think about we think about markets, you're talking about AI and the capital span and going against AI where we're an AI factory, where we're actually creating in manufacturing intelligence, those plants are going to go to the places where states have low electricity prices, and policies are setting price, not just markets, and we've got policies in blue states around our country. California. You mentioned California.
Sixty three percent of California's oil is being imported from foreign countries because of blocking of pipelines coming into that state. They have a record number of internal combustion cars in California. They have more internal combustion cars than any other state as cars. And yet two refineries have announced that they're shutting down in California because of policies, not because of lack of demand, not because of lack of consumers, and so what's.
Going to happen.
You're going to have oil tankers and refined products coming into San Francisco Bay and coming into Long Beach and record numbers in California because of policies, they will have higher gas prices than virtually any other state. So again, we have a strategy in America to help every state. The Trump administration wants to have low affordable energy prices for everybody, whether it's heating your home or driving your car, or producing electricity for AI.
But we're going to need the collaboration from states to make sure.
And if states don't want to collaborate on that, then you're going to see this trillion dollars at AI, a historic amount of spend, all going towards states that have pro energy policies that drive down prices.
Secretary, we've seen a significant increase in energy costs, especially for individuals who live near data centers. How is the US going to do both at once, both support these AI inities but also make sure consumers energy prices remain affordable.
Well, if you said on the show, I mean these prices are in electricity are local, not national. And so there are the examples that you think we're driving that analysis right now and we're going to be publishing that from the White House to the National Energy Dominance Council, the Department of Energy doing great work on that. But a lot of the higher prices that you're seeing are
not related to the AI data centers. A lot of the day A data centers are going to be off the grid, behind the meter and then producing adding more energy, and then and putting some of that energy onto the grid.
So we could be actually increasing.
The supply in some of those areas where we've got increased pricing, it's because of the policies they pursued the last five years of having unreliable, intermittent and highly subsidized and projects, including things like offshore wind where people were spending eleven billion dollars to create one gigawatt of intermittent you know, versus spending one or two billion dollars to create one gigawat of assured seven by twenty four hour power.
So the policy choices of the last five years, driven by sometimes climate extremists, were the ones that were that were that are.
Driving up the prices that you're seeing.
I mean, electricity costs three times as much in New England as it does in North Dakota. That is not that is not because of data centers. That's because of policies.
US Interior Secretary Doug Brogham, thank you so much.