The Trump administration may announce as soon as Thursday a plan to offer loans to the ailing oil industry possibly in exchange for a financial stake, according to two people familiar with the matter. Treasury Secretary Steven Mnuchin and Energy Secretary Dan Brouillette have already briefed President Donald Trump on a plan to provide financial aid to oil drillers beset by a historic crash in prices, the people said. Brouillette, during a conference call Tuesday with an industry group, said Mnuchin was leaning toward aid that includes two separate programs — bridge loans and emergency lending authority through the U.S. Federal Reserve — designed to help smaller and medium sized companies.
“This is not going to be a bailout,” Mnuchin told reporters in the White House Wednesday. He said a team at both the Treasury and the Energy department are talking with people around the world and are considering “a lot of different strategies.” Trump said an announcement would come “shortly.”
The move comes as companies coping with a devastating plunge in prices have been laying off tens of thousands of workers and idling drilling rigs while asking for government assistance as they seek to stave off bankruptcies. Trump last week vowed to make funds available to oil and gas companies, saying he would “never let the great U.S. Oil & Gas Industry down.”
More Storage
Mnuchin said the administration was also exploring the opportunity to store another several hundred million barrels of oil, which would exceed the current physical capacity of the government’s Strategic Petroleum Reserve.