The White House has reportedly fielded several phone calls from allies in the energy industry who have not only expressed alarm about oil prices, but also cautioned against supporting a paid sick leave policy for workers.
While coronavirus spreads across the United States and creates a public health crisis, The Washington Post reports that the Trump administration is now considering providing federal assistance to oil and natural gas companies affected by falling oil prices driven by the outbreak.
White House officials, concerned by the possibility that numerous shale companies may be forced out of business if oil prices continue to fall, are reportedly discussing providing low-interest government loans to the oil producers.
Oil prices have plummeted in recent days and experienced their largest one-day drop in nearly 30 years on Monday due to the new price war between Saudi Arabia and Russia, two of the world’s largest oil producers.
According to the Post, Trump and his advisers have fielded several phone calls from concerned allies in the energy industry who have not only expressed alarm about oil prices, but also cautioned the White House against supporting a paid sick leave policy for workers.
The U.S. is the only developed nation in the world without a federal law requiring employers to give workers paid time off when they’re sick, which has raised concerns that millions of low-wage American workers might feel pressure to keep going to work even if they’re sick. Nearly six in 10 Americans also live paycheck-to-paycheck and can’t afford to miss work, a reality that could cause the coronavirus to spread quickly among these populations.
These fears have reinvigorated calls for instituting a federal paid sick leave policy, and Democrats are trying to pass legislation to provide all workers with paid time off. The White House has considered supporting paid leave, but on Tuesday, appeared more focused on passing payroll tax cuts and providing relief to the hospitality, cruise, and travel industries during the outbreak.
Now, it appears the White House is considering adding oil companies to that list. Among the energy companies hit hardest on Monday was Continental Resources, which lost more than half of its market value, before recovering about 8% on Tuesday. Harold Hamm, the company’s founder and a Trump supporter, had a particularly rough day, with his 77% stake in the company losing $2 billion of its value.
Hamm told the Washington Post that he reached out to the White House but had not made “direct” contact with Trump. He told the Post that he supports “any action that the administration might take to protect and preserve American interests at this time from being unfairly disadvantaged by whatever government — and we’re talking governments here, whether it be Russia or Saudi Arabia.”
Any federal aid to oil companies would require the support of Democrats, who have been focused on proposals to pass paid sick leave, expand unemployment insurance, provide workers free coronavirus tests, and ensure children who depend on school lunch have access to food. It’s unlikely Democrats would support any effort to bail out energy companies, and some experts also believe federal aid for energy companies is unlikely.
“It’s difficult when governments selectively target individual industries,” Chris Rupkey, chief economist at MUFG Union Bank, told the Post. “And there’s going to be pushback on it because it’s political and may be tied to the administration’s contacts and the people it knows.”