Global energy policy can be boiled down to hopes for a warm winter, Tellurian Corp. Executive Chairman Charif Souki said during a webcast Sept. 28. And that approach, which ignores the need for infrastructure, will inevitably result in blame directed at the energy industry.

“I see nothing but catastrophe,” Souki said during a discussion hosted by Washington-based Center for Strategic & International Studies. “It’s kind of disconcerting and you know what is going to happen: We are going to be called pandemic profiteers or something like this and I’m horrified at that thought.”

Souki, who led the U.S. shift from LNG importer to exporter when he ran Cheniere Energy Inc., spoke as the price of natural gas rose above $6 per million British thermal units (MMBtu) briefly on Sept. 28. The benchmark Henry Hub price ended trading for the day at $5.84/MMBtu, a seven-year high. In Europe, the closing price was $26.89/MMBtu and in Asia, the benchmark was $29.35/MMBtu.

“I would like for the price of gas to be more predictable, a lot less volatile and that the planning happen on a normal basis in order to avoid this huge volatility,” he said. “In one year, we went from $2.50 gas prices globally to $25 globally. It’s just terribly destabilizing.”

The recent gas price spike was “all predictable,” Souki said. “This should not be a surprise for anybody. Fundamentally, if you invest in supply, you are going to be in a good position and if you don’t invest in supply, then you run the risk that if demand doesn’t do what you expected it to do … you have a problem.

“We have been lulled by a period of low prices everywhere, not just for natural gas but for energy in general,” he continued. “We became complacent. We looked at the data with optimism, thinking that things were not going to change. And they did change, and they did change predictably.”

In Souki’s view, the natural gas world is divided into two parts—the U.S. and every other country. The U.S. has enormous amounts of energy, but suffers infrastructure constraints. Build that infrastructure and this country can continue to enjoy plenty of energy at reasonable prices, he said.

The rest of the world, however, is not as lucky. Outside of the U.S., the world relies on natural gas from only two other major producing countries: Qatar and Russia. Qatar has announced plans to ramp up its production of LNG by 40% by 2026, but Souki is skeptical of its ability to accomplish that goal. Russia lacks the necessary to expand its exports, he said.

And that raises some key questions in terms of how the U.S. sees itself in the world, Souki said.

“The central question with what is happening now is, what are we going to do about our critical position?” he said. “Are we going to keep it for ourselves or are we going to share it with the rest of the world?”

The question is one of infrastructure, he said, noting that high gas prices do not exist solely beyond this country’s borders.

“California and New England are also suffering from high prices, but that’s because they don’t want to build the infrastructure,” Souki said. “That’s the decision that we have to make today. Are we part of the world economy or do we want to be isolated?

The infrastructure issue is atop Washington’s agenda this week because two major infrastructure bills are facing crunch time in Congress. Souki said he favors the $1 trillion infrastructure bill that has already passed the Senate, but made it clear he considers it to be a starting point.

“If we think this is the end of the infrastructure investment that we need in this country, we are delusional,” he said. “First, we are going to need to choose our energy source.”

Simply stating a desire for electrification isn’t enough because it’s necessary for policymakers to decide how to generate that electricity. And the consequences for getting it wrong are high.

“It’s amazing because diametrically opposed political systems in California and in Texas [have] the same issue—dysfunctional grids,” Souki said. “You can’t say that one side is more apt to deal with the issue than the other side they’re both making a total mess of their infrastructure.”

He said he has backed a carbon tax as part of the solution for the last 10 years. A tax will help to manage demand and restore equilibrium. The only way to combat climate change as an existential threat, Souki said, is to increase the cost of carbon in the energy mix.

“If you don’t want to acknowledge this, then you’re never going to be successful,” he said. “Going around saying that non-hydrocarbon energy sources are cheaper is just wrong. It’s not true.”

Souki also shared his opinion of President Joe Biden’s goal of achieving carbon-free electricity by 2035.

“That’s not an energy policy, that’s a prayer,” he said. “We’re not going to get that. It’s unrealistic. You can aspire to whatever you want. At some point, reality is going to hit you in the face.”

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