Apr 2, 2020 - Energy & Environment

Mnuchin suggests oil companies could receive Fed aid

Treasury Secretary Steven Mnuchin
Treasury Secretary Steven Mnuchin. Photo: Win McNamee / Staff

Treasury Secretary Steven Mnuchin said Thursday that oil companies are eligible for aid from new lending programs the Federal Reserve is setting up, but not direct loans from his department.

Why it matters: U.S. producers are facing financial distress from the price collapse that stems from COVID-19 causing an unprecedented drop in oil demand, and the Saudi-Russia price war.

Driving the news: GOP Sen. Lisa Murkowski of Alaska, who heads the Energy Committee, on Wednesday sent Mnuchin a letter urging him to consider the industry for loans under the recently signed $2.2 trillion economic rescue bill.

Where it stands: Mnuchin, when asked about her request at a White House briefing, said he has "very limited ability to do direct loans out of the Treasury," and that he can provide only for specific sectors including airlines and national security companies.

But he added: "Outside of that, we work with the Federal Reserve to create broad-based lending facilities, which we will do."

"Our expectation is the energy companies, like all our other companies, will be able to participate in broad-based facilities, whether it's the corporate facility or whether it's the Main Street facility."
— Treasury Secretary Steven Mnuchin
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