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00:00REALITY IN THE ENERGY SECTOR. I WOULD BE SITTING IN A DIFFERENT JOB WITH A BETTER SUIT IF I COULD PREDICT THE OIL SECTOR. PIMM: DOWN ABOUT 2.5% IN NATURAL GAS TODAY. ARE WE IN A GLUT IN NATURAL GAS? GUEST: WE ARE SEEING WE ARE IN REVOLUTIONARY TIMES WHEN IT COMES TO THE ENERGY SECTOR. WE'VE MOVED AWAY FROM THE PARADIGMS WE HAVE KNOWN IN THE PAST AND WE ARE TESTING WHERE WE ARE GOING IN THE FUTURE. IF YOU LOOK AT NATURAL GAS, THIS IS A GREAT TRANSITION FUEL AS WE LOOK INTO THE FUTURE AND DEMAND IS GOING TO START PICKING UP IN OTHER MARKETS AROUND THE WORLD AND WE SEE MORE DISCOVERIES OF GAS AND MORE DEMOCRATIZATION OF GAS SECTOR. IT'S NOT ONE COUNTRY OR A SMALL HANDFUL OF COUNTRIES THAT ARE CONTROLLING IT. IT'S OPENING UP AND IT'S NOT ONLY BECAUSE OF THE SUPPLY BUT THE TECHNOLOGY HAS ENABLED GAS TO BECOME A MUCH MORE SPECIAL COMMODITY. MARK: YOU JUST USED THE TERM REVOLUTIONARY. WHAT IS SPARKING THE REVOLUTION? AMOS: THE REASON I THINK IT IS REVOLUTIONARY IS IT'S NOT ONE THING HAPPENING IN THE ENERGY SECTOR. WE SEE A NUMBER OF THINGS FROM RENEWABLES TO OIL TO GAS HAPPENING AT THE SAME TIME. A TREMENDOUS SHIFT IN THE DEMAND SIDE. INSTEAD OF THE OCD DRIVING THE DEMAND, THE NON-OCD COUNTRIES ARE DRIVING DEMAND. ON THE SUPPLY SIDE, WE SEE NEWCOMERS ON BOTH SIDES OF OIL AND GAS. IT'S NO LONGER OPEC PLUS A COUPLE. MARK: ARE THERE SOME COUNTRIES WHO REFUSE TO RIP UP THE OLD PLAYBOOK AND UNDERSTAND WE HAVE A NEW PARADIGM NOW? AMOS: I THINK THAT MAY HAVE BEEN TRUE ABOUT A YEAR AGO AT THE BEGINNING OF THE DECLINE IN OIL PRICES. BUT NOW EVERYONE UNDERSTANDS WE ARE IN A DIFFERENT PLACE. PRICES MAY BE SET ON MARKET VALUE VERSUS POLITICAL ONES, NOT THE GEOPOLITICS IS OUT OF ENERGY. PIMM: WHAT IS THE ROLE OF THE SPECIAL ENVOY AT THE STATE DEPARTMENT? AMOS: WHAT WE HAVE RECOGNIZED OVER THE LAST SEVERAL YEARS IS THAT ENERGY IS PLAYING A GREATER AND GREATER ROLE IN FOREIGN POLICY, WHETHER WE LIKE IT OR NOT. PIMM: THAT HAS BEEN TRUE SINCE WINSTON CHURCHILL WENT FROM COAL-FIRED BOILERS IN NAVY SHIPS TO USING CRUDE OIL. AMOS: I NEVER SAID THE GOVERNMENT ACTS ON TIME. WE RECOGNIZE THAT EARLY IN THIS ADMINISTRATION THAT WE NEED TO CHANGE THE PARADIGM AND HAVE A SEAT AT THE NATIONAL SECURITY TABLE OF PEOPLE WHO UNDERSTAND BOTH THE MARKET SITE AND WHAT THIS MEANS. LOOK AT WHAT IS HAPPENING AROUND THE WORLD -- NATURAL GAS IS USED AS A TOOL OF COERCION IN CENTRAL EUROPE AND EASTERN EUROPE BY RUSSIA. WE HAVE ELEMENTS WHERE ENERGY IS PLAYING A CRITICAL ROLE IN FOREIGN POLICY DECISION-MAKING. MARK: OUR OPEC NATIONS SERIOUS ABOUT INVESTING IN RENEWABLES? AMOS: I THINK SO. I THINK IT'S SLOW. UAE HAS BEEN A LEADER BUT SAUDI ARABIA HAS A VERY AMBITIOUS TARGET. WHETHER THE TARGET IS ACHIEVABLE IS NOT FOR ME TO JUDGE. THE IMPORTANT PIECE IS THE FOCUS IS THERE. COUNTRIES UNDERSTAND IF THEY WANT TO CONTINUE DOING WHAT THEY ARE DOING, THEY NEED TO HAVE DIVERSIFICATION. MARK: WHO IS OUR NUMBER ONE PARTNER IN THAT? AMOS: WE WANT TO PARTNER WITH EVERYONE WE CAN BECAUSE WE BELIEVE DIVERSIFICATION INTO RENEWABLES FOR ALL OF THE OPEC COUNTRIES IS IN THEIR BEST INTEREST AND HOURS. WE LIKE TO SEE THAT AS OUR OIL ORDERS. SOME ARE AHEAD OF THE CURVE MORE THAN OTHERS. PIMM: THANK YOU VERY MUCH. THE SPECIAL ENVOY FOR THE BUREAU

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Oil Set for Weakest Quarter Since 2009

U.S. State Department Energy Envoy Amos Hochstein discusses energy prices and the energy sector. He speaks on "Bloomberg Markets." (Source: Bloomberg)

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