EU efforts to control energy costs are like a Ponzi scheme, says former Trump energy secretary

According to Dan Brouillette, who served as energy secretary under the Trump administration, some of the measures European governments have taken to keep electricity costs down can be described as a "Ponzi scheme".

One of the easiest policy levers to use would be to pass a bill and give money to citizens to pay their electricity bills.

Brouillette warned that the inflationary impact of such measures should be taken into account by the government.

Brouillette said that it could be described that way. There is no doubt about that.

It alleviates the immediate pain of not being able to pay the electricity bill, but it is not a long term solution.

The EU countries will discuss ways to control gas prices.

The price of gas in Europe went up 30% on Monday after Russia decided to keep its main gas supply line shut. Europe has seen a drop in gas exports from Russia.

Consumers can expect higher energy prices in the future according to the former energy secretary.

Brouillette said that oil markets are very tight and that more oil will be used for heating and other purposes as winter approaches. As Saudi Arabia hints at cutting its oil output, there's a chance of an energy squeeze.

Producing more is the answer to alleviating the scarcity.

The ultimate answer to the questions is if we can produce more and create more infrastructure development in the US and Europe. The United States needs to return to pre-pandemic levels of production.

We are a million and a half barrels short of what we used to be. It is important that we return to that number.

Joseph McMonigle is the secretary-general of the International Energy Forum. He said that half of the gap between supply and demand is from U.S. producers.

Brouillette said it was a strange request by the Biden administration to encourage U.S. oil producers to stop exporting.

The U.S. energy secretary urged the country's refinery to build fuel inventories instead of exporting fuel.

Brouillette said that the oil market is backward. When the price of a commodity is higher than the futures price, it's called backwardation. Producers have more incentive to put their product in the market. He said that publicly traded companies in America have fiduciary responsibilities.