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Obama energy secretary: Coronavirus economic fallout could cause 'permanent' changes in oil industry

Obama energy secretary: Coronavirus economic fallout could cause 'permanent' changes in oil industry
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Former Energy Secretary Ernest MonizErnest Jeffrey MonizOVERNIGHT ENERGY: Dems press Trump consumer safety nominee on chemical issues | Lawmakers weigh how to help struggling energy industry | 180 Democrats ask House leadership for clean energy assistance Lawmakers weigh how to help struggling energy industry The Hill's Coronavirus Report: Surgeon General stresses need to invest much more in public health infrastructure, during and after COVID-19; Fauci hopeful vaccine could be deployed in December MORE said job loss resulting from the coronavirus pandemic could have lasting effects on the energy industry, including the oil and gas sector.

Oil prices have dropped to historic lows during the pandemic, at one point falling into negative pricing as a collapse in demand led to an oversupply of petroleum.

Moniz, who served under the Obama administration, said that while demand is likely to resume as the economy reopens, that may not be enough to save the industry.

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“Frankly, we're going to see, I think, some permanent structural changes in that industry,” Moniz said in an interview with Steve Clemons, who writes The Hill's Coronavirus Report. 

“And those structural changes were being called for before the virus because of the structure of the American oil industry, which was not exactly managing a great cash flow. ... Not all of those jobs, frankly, are going to be there, so we need to think ahead.”

The renewable energy industry has also been hit hard by the economic fallout from the virus, losing almost 600,000 jobs since the start of the pandemic.

Some environmentalists have worried low fossil fuel prices could further hurt the renewable industry and slow a transition to cleaner fuels.

“On the one hand, it's clear that things like collapse in fossil fuel prices historically have diminished the enthusiasm for some of the transition, whether it's for wind and solar or electric vehicles, for example. But on the other hand, I think that the reliability of those renewable sources really has to be in people's mind as we have seen this extreme volatility in the fossil fuel industry, specifically in the oil industry,” Moniz said.

“In the longer term, I feel very, very bullish that we will continue the low carbon transition.”