Power Lunch - Stocks Jump After Trump Truth Social Post 3/23/26

Episode Date: March 23, 2026

Stocks jump after President Trump's Truth Social post on the Iran War. Brian Sullivan is live from CeraWeek with a number of key players in the energy industry.    And where are oil prices heading? Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Stocks are higher on fresh hopes for de-escalation in the Middle East. Welcome to Power Lunch. Alongside Dom Chu, I'm Kelly Evans. We'll see Brian in just a moment. And here's where we stand at this hour. Dow's up about 841 points. The session highs we were up 1,000. Still, we've been moving higher over the past hour or so.

The S&P's up 1.5% and look at the rustles up nearly 3% after falling into correction territory at the end of last week. The other big mover is energy, of course. WTI and Brent both falling. each are now down about 10%. Still, that puts Brent above $100 a barrel. But we had WTI at 100 before the president spoke today about this five-day pause and his strikes on Iran. Dom, over to you. It's been a crazy day so far, not just for oil, but stocks overall, Kelly. Let's take a look at some of those sectors that are moving, sticking with that energy theme. That sector is hitting, by the way, a record intraday high. Names like SLB, Baker Hughes, Halliburton are leading that entire energy

complex hire on the day. But the best performing sector right now is consumer discretionary, led higher by Norwegian cruise lines, Carvana, Carnival, MGM, and Royal Caribbean. You can kind of see that consumer spending tilt, maybe even fuel costs playing there. So Kelly, keeping on some of these names, solidly bid for right now. I'll send things back over to you. All right, good point. Dom, thanks. Now let's get a check in on Sierra Week, the big energy conference down in Houston, where we find our Brian Sullivan, who's had amazing guests all day long and we'll have several more this hour. Brian, what would you say the news is and what are you hearing on the ground floor? Yeah, hey, good to see everybody. We certainly have had a lot of guests already. And in fact,

one of the stocks that Dom just showed, Baker Hughes, Lorenzo Seminelli, was our first guest on Squawk Box this morning. That full interview is up. Here's what I'm asking everybody, really oil and gas. Okay, what implications are they seeing at their company from the war and what do they think is going to happen. The short answer on the second part of that is nobody really knows what's going to happen. And I think that's kind of, Kelly, to your point, what we're hearing on the ground. I was at an event last night. I'm here today. And what people will say in public, they'll say, listen, we're optimistic. We hope for a short end of the war. The president's comments, obviously moving the market today, stocks are up, energy prices are down. But I think in their private moments, you're going to have

people that are whispering to us saying, we just, we're not sure. And there's nobody that can really give assurance to the U.S. or the global oil and gas markets where things are going to go. Because we're not even really sure who is running Iran at this point. That's not my opinion. It's sources in D.C., sources overseas, and people here. And by the way, these oil and gas companies have some of the best intelligence because they operate around the world. So they have very, very high level, maybe not CIA level, Kelly and Dom, but they have very high level intelligence, so there's things that they can talk about. All right, in power lunch in a few minutes, we're going to talk to one of the largest renewable energy producers and biggest natural gas

producer in America. That is next era energies. Then we've got the Secretary of the Interior, Doug Bergamont back on as well. He was on with us last week. Obviously, much has changed. They just got back from Asia. And the majority of the Asian markets, guys, they are the primary in markets for all the fuels, oil, gas, LNG, fertilizers. What? whatever that comes out of the Persian Gulf. We'll talk about what he's learned and where we're going to go. And then the inflationary aspect of all of this. It's not just about the short term on energy. What about the longer and medium term in the economy? Las Glouzard, chair and CEO, Peter Orszag, all that's coming up over the next 57 or so minutes.

A lot to pack in. Brian, for now, thanks. Appreciate it. Brian Sullivan. And let's take a broader look back at the markets where we see the Dow up 820 points. Oil and gas. are lower. That's all on hopes the U.S. and Iran could, I don't know, do we reach a deal? Do we just say there's an end to the war? Our next guest oversees a cool $1.9 trillion. So let's ask him what advice he is giving clients now. Ben Heineke is head of Morgan Stanley investment management. Ben, it's good to have you here. Welcome. Kelly, Dom, thank you for having me. So there's a few, you know, there's sort of like the expected way that people might settle their clients. Hey, geopolitical. I think I could do this. I'd say, don't worry,

but then there are the moments that things can change. And I'm curious where you you land on some of these. Like, for instance, there are those who thought going into this preference for international stocks over U.S. Do you change that now? The medals were flying to start the year, but now gold and those. So where do you think we kind of like resume the trend, and where do you think the trend has changed? Yeah, I mean, look, I think it's important to remember where we started heading into this, which was the earnings setup was pretty positive. You know, the earnings growth that we expected going into 2026 was actually quite strong into 2027. Obviously, the events over the past three weeks have changed that somewhat,

but it's really hard to trade into this level of volatility. The sectors that were performing poorly last week are now performing well today. There's so much volatility. So we've cautioned our clients to maybe be a little bit more conservative, a little bit more liquid, take a little duration out of the portfolio potentially, but it's really hard to be tactical when stuff is changing so dramatically. You know, we were just having, we just had Andrew Beer over at DB, you know, DB investments on, and he runs managed futures, right, for an ETF wrapper. And one of the things he said that kind of resonated with me was the crystal ball is broken for whatever there can be a crystal ball in this marketplace, pointing to this idea that

we don't see this kind of market action in a normal market environment. Is that the way that you would characterize it? Is there a way for you to glean what could be more medium long term? Or is this just a situation where you have to kind of step back and say, I need to reassess my risk profile. So one of our PMS made a comment that it's to go on TV and say there's uncertainty is a little repetitive because there's always uncertainty. But this does feel like a moment where there is so much bifurcation in terms of what the outcomes could be in terms of what happens in the situation in Iran, that it's very hard at this point to have the crystal ball

working appropriately. So we've kind of cautioned our clients to keep their asset allocation fairly stable with maybe a little bit more conservatism just to wait for more clarity around what happens. Yeah. So, for instance, look at the sectors this year. Energy up 30%. I think consumer staples utilities are strong. I don't know if you do kind of tilting, you know, to try to help people generate out performance. But if so, do you lean into those areas? Or do you look at the software names, which have been hardhead and maybe there's an opportunity there? How are you thinking through those areas to capture value? We have, across our $1.9 trillion, we have lots of strategies that have different bends and tilts. You know, the software is an interesting one,

just given its impact on the private credit space and the private equity space, given the concentration there. We do feel some of those fears are a little bit maybe outsized versus the reality and the predictive nature of what we think AI technology is going to do to that sector. We may be a bit premature or a lot of uncertainty around exactly how that AI trend is going to impact software. And we don't feel like the impact on that software sector is going to be uniform. It's going to be very differentiated. So that's an area where we've sort of leaned in with our clients and to look for opportunities there, especially in the private credit space. A lot of our institutional clients are now looking at this as an opportunity versus a threat.

Does that mean they would go so far as to buy some of the BDCs and that kind of thing? Or are you thinking more through exposure to like a private equity asset manager whose stocks down 30, 40 percent? Look, what's interesting is there's been so much focus on the private credit. But private equity is actually very focused in software as well. And private credit sits above that private equity in the capital structure. So we think private credit and allocations there, when you've seen the interruption in flow from wealthy individuals into private credit, a lot of our institutions are looking at that as a potential opportunity in this vintage to allocate into private credit. Now there's been a disruption of flow from private capital into private credit. You know, Ben, that also implies, right, or even outright states that you are not panicked at all about certain of these outcomes that are being forecasted in places like private credit or high yield or in other places within the private.

equity world itself. So you were being opportunistic. You wouldn't be opportunistic if there was a macro issue with some of these asset classes, would you? Yeah, we don't believe that there is a mass casualty or mass extinction event happening in software. So I think that's way too broad a brush to paint the situation. And so we don't see that as a reality of an outcome. So we do think there's an opportunity in the space and we think a lot of the fears are overblown. So going back to, you wake up today, the president is indicating some, how do you say, whatever he's, he's indicating peace. Let's put it that. He is putting that out into the world and the world is responding appropriately. If tomorrow that is different, what happens? You know, if the next,

so that's why I think it's so interesting. How do you position when we don't know if this might flare up again for a few weeks, if there might be like an impact on the oil price for a couple months just leave? So going back to sectors and energy and things like that, how do you position? I think, you know, obviously a huge amount of uncertainty day to day, right? The market opened up 1,000 and now faded because is it clear who he's talking to in Iran and what the possibility of a positive outcome in Iran is? And what is the time frame? I think the most important thing to look at is the time frame of disruption, which is how long will oil prices stay high?

You know, if oil prices stay high for a month or six weeks, we think that could have a modest negative impact on growth, but nothing too dramatic. If we find oil spiking, 150, 175, 200, that could be a significant impact to growth and a growth challenge for the economy. And it's also, I think, important to look at, it's not just the straight that needs to be open, but how much damage is being done to infrastructure that produces the energy and how long is it going to take to get that infrastructure back online? That's why I was so encouraged this morning to hear about the cessation of bombing of infrastructure for a period of time, just because I think that could be a long-tail problem in the energy supply chain that's maybe, not as well understood. All right, Ben, appreciate it. Thanks for coming in today.

Thanks for having me. Ben Heineke with Morgan Stanley. We're just getting started on a jam-packed hour. Brian Sullivan will soon be sitting down with Next Terra Energy CEO John Ketchum, along with Interior Secretary Doug Bergam and Lazard's Chief Peter Orsag. John Ketchum joins us first right on the other side of the short break with the Dow up 800 points.

Don't go anywhere. Welcome back. Shares of Xera Energy are moving higher this today after the Trump administration approved plans to develop up to 10 gigawatts of gnat gas power generation in both Texas and Pennsylvania. So let's bring in now Nextera Energy Chairman and CEO John Ketchum in a first on CNBC interview alongside our own Brian Sullivan at Sierra Week in Houston. Brian, I'll send things over to you. All right, Dom, thank you very much. John Ketchum, good to have you back on. Great to be here. First question, is there any relation to the war to energy price spikes,

oil, gas, whatever, around the world? That directly impacts next era. No. None. None. Okay. None. Why not?

Because natural gas prices is a state stable. Our natural gas comes here from domestically supplied resources. So Henry Hub has not seen a whole lot of volatility. That's a gas price here in the United States. But overseas, it's here in the U.S. It's $20-30. And because the export activity is not that high. Yeah.

And because we're producing all of our own national, natural gas or just hasn't been that much of an impact. So Dom came up to us and said, you guys were just awarded, awarded 10 gigawatts of power. That's like, what is that 7.5 million homes or something like this, worth of power by the Trump administration? What does that mean? How does the federal government award next era a power contract? Well, here's how it works. So they're working together with Japan. Japan has a $550 billion in business. investment fund. Part of those dollars are going to energy infrastructure investments right here in the United States. So they are going to actually invest in up to 10 gigawatts

of plants that we're going to build, about $33 billion of investments. We still have to work out the definitive agreements with the Japanese over the next few months here, but something we're really excited about. Next era is bringing scale solutions to power data across this country. It's one of the big parts of our tragedy. Yeah, you've got a nuclear power plant in Iowa called Dwayne Arnold, which will be coming back online hopefully in a couple of years. But is there a way I asked NRG's outgoing CEO in the exchange the last hour to quantify data center impact on their financials or even other earnings, right? I know you haven't announced it, but can you give us a generalized idea of what every gigawatt

or whatever of new data centers might mean to the bottom line of next era? Yeah, I mean, for us, I mean, we've already put out our financial projections through our, you know, our expectations through 2032. 8% plus, that's the largest rate regulatory utility in the United States at FPL, plus an energy infrastructure business that does business in every state in America except for Alaska. Part of that is data center buildout. But in terms of quantifying, you know, how much that means to EPS, it does have a sense. significant impact on our driver. We have a very well-diversified portfolio, though, where we have generation opportunities that come from all different parts of the economic development opportunities that we're seeing here in the United States. All right. So we've got the Secretary of the Interior

and head of National Energy Dominance Council, Doug Bergam, will likely, he'd probably be walking up as you're leaving this interview. A lot of people in America, they're facing higher electric bills all across the country. What can the federal government do? What can Secretary Bergam do? And Secretary Wright, we spoke to it earlier. What can they do that would help next era grow to where energy costs could stay stable or maybe even go down? Is there something the federal government can do?

Yeah, no, absolutely. And they're doing it. I mean, they're really driving the energy dominance agenda across the United States. They're really helping on permitting, helping to get projects approved. faster, quicker. And the Secretary of Interior, Secretary of Bergam is doing a terrific job on that. The National Energy Dominance Council is doing the same thing. What they're trying to do is figure out where the pain points are in terms of getting energy infrastructure investments off the ground. And they're really helping to try to expedite that permitting process, which lowers cost across the board.

I look at my company, Florida Power and Light. We're doing both. We're able to accommodate a higher power demand. with a lower bill. Like in Florida, our bill is increasing 2% a year. We have a bill that's 30 to 40% lower than the national average. Ryan, if you don't mind it, I'd be happy to jump in here. John, if you can hear me, it's Kelly back in the studio. And even as you're extolling all the great things that are happening in our country, I can't help but wonder, should we be doing more to try to get our cheap natural gaffes in other people's hands globally? What's our, do we have a constraint in that sense? Should we be doing more to support that expert? capacity and do anything to kind of reorient global trade flows away from the strait of Hormuz.

Absolutely. And we're doing it. I mean, from a natural gas standpoint, we're building more LNG export terminals here in the United States that's really going to help lower natural gas prices, you know, globally as those cheaper, you know, molecules here from in the U.S. that are generated by all of the upstream activities that we have here find their way outside the country through those LNG terminal investments. I also wonder if there's any way that your industry. Sometimes I hear reports that it's hard to get Nat gas if you're building a new factory or even for some data centers. They do a lot of diesel

backup for that reason. So I assume that's kind of a pipeline permitting thing, but I also wonder as oil prices spike, if there's anything more we can do to make natural gas, which continues to remain cheap and plentiful, an attractive alternative. Absolutely. And we're doing it. That's part of that 10 gigawatt award that we got on Friday. That's all natural gas. That's all natural gas development that we're going to bring forward to the marketplace. And if we can combine that with permitting reform to make it easier to build natural gas pipelines, that's going to lower cost across the board as we access natural gas as a cheap resource to be able to electrify our power sector and be able to lower bills for everyday Americans and power data centers at the

same time. And one of the things that we're trying to do as an industry is bring your own generation to data centers so that the average everyday American is not shouldering the cost of the bill associated with powering data center buildout. And I think that's working really well also because we're seeing data centers come forward with the pledge they signed a couple of weeks ago with the White House saying, look, we're going to take on the cost responsibility associated with building out this additional energy infrastructure. And I want to clear something up because you guys are a huge renewable. So I think you're the largest renewables producer in the United States.

Can you run a data center on solar and wind and battery backup? Well, here's what we do. So we build out. Not you, but can anybody? Yeah. People complain all the time. And it's like this, there's like this weird fight. Like oil and gas, wind and solar.

Yeah. Don't we need it all? We need it all. And why are people so in their corners like they can't get out of their corner? And what we design is what's the most economic solution for our customers? Because we do it all. We're the world's leader in renewables, world's leader in storage. We run the largest natural gas fleet in the United States.

We're the largest consumer of natural gas in North America. And we run one of the largest nuclear fleets in the U.S. as well. So our job is to combine all these resources together to provide low-cost, affordable energy to our customers. John Ketchum and next Air Energy. we're going to leave it there. And Kelly, I got even better news for you. There's an old power plant just in Kearney, New Jersey. It's been there for like 150 years. And if that thing didn't run a few times this winter, it's unclear if we all in the lovely New Jersey area would have had enough power to turn the heat and the lights on. Where's Kearney? 150-year-old power plants. It's like near Secaucas,

Jersey City-ish. Yeah. Yeah. It was the largest coal plant in New Jersey, and it's been converted. But if that wasn't still running at peak times, we'd be hosed, I think our Canadian friends would say. And that's with like 40, 50% nuclear. We're fortunate in that sense. Brian, thanks. Our thanks to John Ketchum as well. That was really super fascinating. What is the all-powerful bond market telling investors about the president's approach to the Iran war. We'll get into it after the break. All right. Welcome back. That was a look at the Dow up about 800 points right now. Let's go to the bond markets now where U.S. Treasury yields are on the move. The two-year note yield crossing above the 4% level for the first time going back to June before pulling back.

So Rick Santelli joins us now to make sense of what's going on with rates, especially when it comes to that front end side of things as a possible proxy for Fed policy. Yes, if we look at a two-year note, Dom, you're exactly correct. Right around 6.45 a.m. this morning, it touched 401. Haven't closed above 4%. having closed 401 or higher since the 10th of June, of course, of last year. And if you add in crude oil to that chart, you could clearly see how it is really playing the tune that all the markets are dancing to. Why? Because crude oil is your best real-time evaluation of what's going on with regard to the conflict in Iraq. There's another issue

there. Crude oil, see the high and low? 101 high, 84 low. There's a lesson there. That's how quickly the effects of higher oil can dissipate with any types of good news. And finally, it isn't just our rates and it isn't just two-year rates that are following crude. It's all around the globe. Here's a 12-hour chart of U.S., UK, and German 10-year yields. They all rhyme exactly. I could throw the dollar index up there. It would look exactly the same. Basically, one market is dictating the moves in all markets. Yet the good news is we can go from over 100 to below 85 in just a few blinks of the eye. Kelly, Dom, back to you. All right. Thank you very much, Rick Santelli. Speaking of that, we've got more from

Syra Week coming up. Brian Sullivan sitting down with Interior Secretary Doug Bergam in just a few moments. Stay tuned. That interview on the opposite side of this break. You can see there the price of crude oil and natural gas tanking today after the president said Washington and Toronto are in talks to end the war in Iran. WTI's around 88 now. Let's get back out to Houston, Texas, where Brian Sullivan is standing by with a special guest who could have more insights into those negotiations and knows plenty about U.S. energy policy. He's joined by Interior Secretary Doug Bergam, who also leads the National Energy Dominance Council, which is tasks to maximize developments of domestic energy. Brian. Yeah, the Interior Secretary Kelly obviously is a huge job.

National parks, the interior of the United States, but it's also 27 percent of U.S. oil output. a lot of that is offshore. And of course, Doug Bergam is, as you said, the head of the National Energy Dominance Council, which means he's involved in international affairs as well, just got back from Asia, recently in Venezuela. Secretary Bergam, good to chat with you again. Can you give us any more insight details, maybe or maybe not, into what's happening with Iran? There's still a lot of questions. Markets reacting positive. But realistically, where do we stand right now? Well, I think the What you're seeing from the president's tweets today is that there is engagement with Iran about, you know, a possible solution going forward. There's a time frame for that to try to progress forward,

so we'll see how that goes. But I have tremendous confidence. President Trump's energy dominance policy was made for exactly this kind of moment, which is for the U.S. to, you know, build up production. We're the world's largest oil producer, world's largest LNG, exporter, world's largest natural gas, producer, sometimes by more than double, you know, number two and number three. So it is a, it's incredible that we've been able to, as a country, unleash all of these natural resources, which again, makes it affordable for people here at home, but it also is the key to prosperity. It's the key to solving a number of these dilemmas. And other administrations have kicked this

can down the road of Iran for 47 years. And it's been a cloud over the global economy during that entire time and President Trump is going to resolve it and I'm very confident as the dealmaker in chief he's going to come out of this with a winning deal for Americans. So we're blessed and lucky to be in the United States for many, many reasons. One of them is relative energy independence, but overseas it's not so lucky. And you were just in Asia. You did $56 billion in deals, liquefied natural gas, South Korea, Japan, our allies. But they're hugely reliant on the fuel, oil, gas, natural gas, chemicals that comes out of the straight of four moves. What are our partners, what did they tell you in Asia about this war?

And I would imagine they need a speedy resolution. Well, yes, they do, but what they also said was they want to buy more energy from the U.S. I mean, this is part of the energy dominant strategy is enough production so that we can have lowest prices, most supply here in the U.S., but then our allies and our friends can buy from us as opposed to having to buy from countries that either wage war or fund terrorism. So if you were buying from Venezuela, Russia, or Iran, then, you know, what were those dollars going towards? They were going towards fighting back at us. So having enough energy, which we do, can help bring peace to the world.

I mean, Venezuela, where I was a couple weeks ago, I mean, we took President Trump's leadership, we took a sanctioned adversary and in less than two hours turned them into a strategic ally. It's taking a few weeks. enough oil to make a difference, though, in the near term. It's going to take long years, is it not? Their production last year was 800,000. When numbers come out, they could be at 1.2 million. They could be up 50% already just in the first two and a half months. And, of course, a lot of headroom growing above that. But when you asked about what they were asking about in Japan, it's not just our allies, it's also, in interior, we've got responsibility for the territories. So Guam, Mariana's

Islands, American Samoa, these Pacific islands that represent our front line of defense in the Pacific, and then plus our 50th state, Hawaii, also out there in the middle of Pacific, they're all just like Japan and Korea, Taiwan, the Philippines, all of our allies, all dependent on foreign oil, so is Hawaii. We're Pearl Harbor. Think of the assets we have there. We stopped. We met with the governor.

We met with the four star that leads the Pacific. We need to make sure that we've got energy security for our territories, for our health. States and one of the places that can come from is Alaska. I was just going to talk about Alaska because I think ExxonMobil just bit on a lease up there. First time in forever. We were together in June of last year on the North Slope. And I actually saw some, the mayor. Yes.

A few of the from the North Slope, Up Kjavik, they're here now today. And we said, we said hi. Any update on that Alaska LNG project, $44 billion. That's a lot of LNG that could be sold to Asia. But a lot of people say it's just too expensive. It's never going to get done. Well, it's going to get done, and it's a high priority, and it's going to get done because, A, the supply, and B, the security.

If you're shipping LNG from Alaska to Tokyo, it's an eight-day trip versus a 28-day trip if there's no constraints. But if you have a constraint at the Straits of Hormuz, the Straits of Mojorka, the South China Sea, there's multiple places where supply interruption could occur for Korea, Japan, for the Philippines, for Taiwan, you know, all of the Thailand, all of our allies that are friends of the U.S. Alaska energy, it's not only eight days, five of those days you're

in U.S. territorial waters along the Aleutian Islands. So it's a secure supply of energy. You're confident it's going to get done. I'm completely confident and we're continuing to work on it here this week. I met with the mayor, as you saw in the hallway him this morning. I mean, the, their organization, the North Slope Bureau are so pro-energy because they see they've seen lifespan increases they've seen oil and gas paper hospital schools clinics roads airports i mean it is the central to the economy and in the national patrolling reserve alaska where we had this record sending lease last wednesday it wasn't just the the names you mentioned but conical phillips who's already there was back in bidding uh but

you know repsall santos a number of other smaller companies and the ones that were there said like wow We were hoping to get more acreage than they did. We had 187 tracks that were sold, record revenue coming into the U.S. Treasury. Huge interest in that. And when the prime minister of Japan was with the president this week, you know what she said? She said, we want to buy more oil from Alaska. We've got a pipe that's only running at 40 percent up there. We don't even need the new infrastructure.

More oil production coming up. And some of those folks that have been up there working are going to see first oil coming this spring. How does the war and the problems at the Strait of Hormuz change your thinking or should change America or Canada's, to be fair, our partner to the North, are thinking on energy supply chains? Because people knew how important it was. I don't know if I certainly didn't. I want to be very clear on that. I did not realize I knew it was important. I didn't realize how important it was.

How do we change our thinking on energy supply chains? Well, I think, I don't want to say, the Trump administration knew this on day one. President Trump declared an energy emergency on day one, and people question him, why is he doing that? We've got all this supply. No, he did it because he understood the risks that exist in the world in these supply chains. We've been working on this problem since day one. We were working on it last June when our military was trying to take out their nuclear production in Iran. We have been completely aware of this thing.

We've aware of how everybody in the Pacific, the whole Alaskan LNG pipeline and unleashing Alaska energy was President Trump understanding that our allies, our territories, in the state of Hawaii, and even the state of California. California, when this conflict arose with Iran three weeks plus ago, California was importing 63% of their oil from foreign countries. The number one import was coming from Iraq through the Strait of Hormuz.

There is zero reason. Into California. Into California. There's zero reason. So every day there's oil. Why? And I know they're getting fuel from the Bahamas because the Jones Act and they had to ship it from Houston to the Bahamas, change ships and come back.

So the Jones Act's been suspended. So should we, number one, should we just kill the Jones Act forever? Because with all due respect to the American shipping industry, it's not what it was 120 years ago or whatever it is. And number two, why is California importing oil from Iraq? Well, this would be a good question for Gavin Newsome, but it's a, There's ships coming in every day to San Francisco Bay and Long Beach with both oil and with refined product. It's going to be more and more refined.

Here we are in Texas, 36 refineries in Texas, a new one being built, the America first one, $300 billion project. California has eight versus 36. Eight is going down to six refineries. Chevron and Valero already announced their closing down. So the state that has more internal combustion machines than any other state has vehicles is through policy restricting their supply of transportation fields. Well, they're going to have two new pipelines, I think, coming into California pretty soon, aren't they? They're going to have to.

They have to. And we've got the energy to supply them. I mean, every American deserves to have, it just has the opportunity to have affordable, reliable, and secure energy, and that's what President Trump's working on. But if people think by blocking pipelines with American natural gas or American energy products is going to save the planet, you're actually just creating a national security risk for the country. And you're raising the prices for everybody in your state.

And we see this in New England. We see it on the West Coast. And we're fighting to make sure that everybody has access to reliable, affordable energy. And by the way, Governor Newsom's welcome any time on this network on this show. Be happy to come out to San Francisco and sit down with him as well. But I'm happy to sit down with you right now. Mr. Interior Secretary, head of the National Energy Dominance Council, Doug Bergam. Thank you very much.

And folks, just a reminder or not a reminder, I'm going to let you know. We've got a new energy-focused newsletter coming soon. It's going to have more content, more longer-form interviews. It's called Power Insider. There's your QR code on the screen. Screenshot it, grab it, sign up today. We're going to be launching it in a few weeks. Can't wait for that as well.

We got the wind turbine. We got the oil derrick offshore power insider. Everything you want to know, some things you didn't want to know about energy. Dom and Kelly, back to you. All right. Thank you very much, Brian. And, of course, to Secretary Bergam as well. We appreciate it.

Let's now get over to Leslie Picker for a CNBC news update. Good afternoon, Leslie. Good afternoon, Dom. Thank you. The Supreme Court heard oral arguments this morning on mail-in-voting and whether states can count ballots that are mailed by the deadline, but don't arrive until after election day. During questioning the conservative supermajority seems skeptical that it should be allowed,

President Trump has long railed against mail-in voting, saying without evidence that it produces widespread fraud. The Trump administration reached an agreement to pay French company Total Energy's $1 billion to stop developing two offshore wind farms on the coast of New York and North Carolina. In turn, the company will make investments in U.S. oil and gas production. The deal comes after federal judges blocked the administration's attempt to stop offshore wind production and allowed construction to continue. And WNBA players just ratified a new deal with the league. The union announced the vote today after agreeing to a new collective bar. bargaining agreement last week. The new deal is valid for seven years and includes salary

increases and a new revenue sharing model of first for women's sports. I interviewed Asia Wilson last week. She was very excited about it. And I think that that emanates throughout the league. A long far road there for sure. Leslie Picker, thank you very much for that. Coming up on this show, Lazard, CEO Peter Orsag, with his view from one of the top investment banks on Wall Street. Brian's going to bring you that interview coming up from Seer. week right after this break. Welcome back. Before the Iran War, there were concerns about the private credit market. The sector's been hit hard as investors scramble to get a sense of what's in the underlying. Some are withdrawing their money on fears of rising default risks. That has names like

Apollo, Blackstone, KKR, and Ares down 20 percent or more since the start of the year as these issues become more visible. For more on the state of the industry, let's head back out to Sierra Week as Brian Sullivan joins us now from Houston for an exclusive interview with the chair and CEO of Lazard, Peter Orsag. Hi, Brian. Yeah, it's not just energy CEOs that are here because there's also trillions of dollars of money around the energy world that are floating around. And Peter Orzac, head of Lazard is here to meet with some of these CEOs that are doing these deals.

And I'm sure be involved in some of these deals. Peter, good to chat with you again. Good to be with you. You know, I'm going to humanize you a little bit because when you sat down, we just talked to Energy Secretary, Interior Secretary of Bergam. And he goes, we were talking about the Jones Act. You go, I hate the Jones Act. Let's talk about the Jones Act.

And we're not going to talk about the Jones. We don't need to talk about private credit, though. How is that for a transition? That sounds great. I don't know exactly that segue. Well, how about this? I'll make it up. Are the private credit cracks that we just showed coming in?

Are they going to sync Wall Street? That was really bad. Sorry. That's okay. It's been a long day. Look, our take right now is you're clearly seeing stress in software and in the retail-oriented aspects of the private credit sector as a whole. But with regard to the rest of it and with regard to the institutional backers, we still think it's pretty limited. And the risk at this, it's almost like a run on the bank.

Because the retail investors that are involved, is there a loss of confidence that then in a relatively illiquid setting causes problems? Second derivative effects. That could well happen. But for the most part, most of this industry, you know, 85 to 90% of it is outside of retail and circa 80% of its outside software, that still looks objectively pretty healthy to our team. Let me ask you a different way. Is this subprime 2007? At this point, we don't think so. Because they don't have all the CLO, collateralized loan obligation. They don't have all the derivative instruments attached to most of this private credit. Is that a fair statement? And the underlying health, especially outside of software, of the underlying loans, we hope, is better than the state of those sleeves of the CLOs, etc. in 2007-8.

Watching my friend and colleague, Steve Leesman, talk about upcoming Federal Reserve expectations. It's been a slight move. There's actually a potential for a rate hike toward the end of the year. some of this energy shock's been inflationary to a point still early. What do you see around inflation and the Fed? So Adam Posen, head of the Peterson Institute and I, maybe two or three months ago, said that we expected that inflation would surprise to the upside in 2026. That was for a whole variety of reasons. Even before the conflict in Iran arose, you were seeing numbers coming in hot,

both the PCE numbers and especially the producer price index numbers. Not all of that is fed through to consumer prices, but we think it will. And now you layer on this additional energy and non-energy shock. Don't forget, there's fertilizer, there's aluminum, there's helium, there's all sorts of inputs into the economy. So I think the odds of inflation surprising to the upside in 2026 are material. So you think it will show, you and Adam think it's going to show up in the CPI numbers, but maybe a couple months out. Correct. And again, how do you cut rates into that environment? Well, if you do, if we're right, if you cut rates into that environment,

all that happens is the yield curve steepens. You know, we're looking at a 10-year. I don't even know where the 10-year is. It's been a long day. Caught 4-38, 439 last time I looked. I mean, 433. See, I say it. They bring it up.

I was off by six faces points. There you go, whatever. You get the direct, it's not going down. We got a president that don't want to drag politics into it. It's talking about lowering interest rates. The bond market is saying something else. What is the bond market's saying? Look, if you look at potential for inflation to surprise to the,

upside. If you look at seven to head seven and a half percent of GDP deficits, which is I think plausible for this year, there's a lot of upward pressure on the long right. In addition, we may just be in a new structural environment where interest rates, we have gotten used to these super low interest rates and interest rates going forward will be more normalized back to, you know, closer to historical norms, especially on the long end. Well, there is a school of thought. There's always a negative, there's always a group of, you know, it's cooler to be negative than to be positive. Let's just be positive. So let's be positive.

But there is a school of thought that if bond yields keep going up, four and a half, four, seven, five, whatever they may or may not get to, that that will, there's a level of which it hits the stock market because you've got to bring down earnings multiples. How does Peter Orzag, I think you know him. How does Peter Orzag see it? I don't trust that guy out. I don't know.

So, no, I think, look, at some point, obviously the discount rate that's applied to future earnings affects stock prices. But in the optimistic note, let me point out one thing that's happened. during the conflict in Iran, that did not happen over Greenland, which is the role of the dollar as the safe havens in the global economy, you know, has come back a bit. We're not, we're seeing gold down, dollar up. That was the reverse of what happened with the tension over Greenland. And that is really important to help reduce long-term interest rates in the United States, or at least keep them contained. If the dollar were to lose,

increasingly lose its safe haven status, which by the way may still happen, but there's a temporary reprieve here. You're going to see more pressure on the long end. I like it. Ending on the positive, the positive may be the U.S. dollar. Temporary at least is still holding its own. Yeah. We'll see. Always love your insight. Peter Roersack, CEO, Chair, Lazard. Peter, really appreciate you joining us here at Sir Week. Thank you very much. Great to be with you. Thank you. Thank you. Kelly. All right, Brian, thank you both. And he's not done yet, folks. Another interview coming up, Michael Sebel, founder and CEO of Venture Global. That was recent IPO, remember? They're at the center of

demand for North American natural gas. It'll be nice to hear from him as well. It's coming up on closing bell overtime. Some relief in the oil space today, but consumers, they're just catching up to this. Their gasoline prices are at highs $394 a gallon, if I'm not mistaken. We're going to give you that number right after this. All right, welcome back. Gasoline prices are climbing fast with the national average now nearing $4 a gallon. According to AAA, prices have reached their highest level since August of 2022, it was $2.94 a gallon just last month. Only nine states are seeing gasoline prices under three bucks, three and a half bucks a gallon, I should say. And Kelly, it's even worse in some states. Drivers in California and Washington state are already paying more than $5 a gallon

for regular unleaded. So an interesting point, I filled up this morning. New Jersey's on the cheaper side in the tri-state area. And even then it was pretty... We're at 388. Okay, the national average is 394 and a half. But I think, again, we have to remember when our oil price might be down 10% today, it's a huge move, 10, 11%, the market's flying. The consumer showing up at the gasoline pump and paying the highest prices yet that they've paid since the Iran War broke out a dollar more per gallon than they were paying a month ago. It's 15 or 20 bucks for a fill-up. The other thing, too, this station where I fill up at also does diesel for like tractor trailers and everything. And even that is now $5 plus per gallon right now. So it's something to watch for sure. Anyway, we've got more

on this coming up on Power Lunch after this short break. Kelly, more conversation as well. All right, before we go, a new CNBC article highlights that consumers are eating less and spending less on groceries amid the rise of cheaper and pill forms of GLP-1s. And J.P. Morgan says this could wipe out $30 billion to $55 billion in annual sales for the food and beverage business by the year 2030. Wow. Now they're putting quantifiable numbers behind some of these things. $30 to $55 billion. And amid a big change coming to Walmart, they say they're expanding digital shelf labels to all U.S. stores by the end of the year that will improve accuracy and save workers' time. But some lawmakers weren't they could open the door to surge pricing.

That new federal legislation, in fact, Dom would ban those labels in large grocery stores for that very reason. It's interesting. The demand pricing thing, they say it's not going to happen, but you just never. Yeah, I feel. I agree. I agree. All right.

Thanks guys for watching Power Lunch. Closing bells for it right now.