Why Charlie Munger at Berkshire Hathaway wishes US wasn't drilling for natural gas

Charlie Munger, Berkshire Hathaway
Lacy O’ Toole | CNBC

The United States should have a longer-term strategy for its natural gas resources, billionaire Charlie Munger told CNBC as part of a wide-ranging conversation on Wednesday.

The Berkshire Hathaway vice chairman's argument hinges on the prospect of the Middle East eventually exhausting its oil reserves, forcing buyers to turn to pay for U.S. natural gas at a higher premium.

"I wish we weren't producing all this natural gas," Munger said. "I'd be delighted to just have it lie there untapped for decades in the future and pay extra once Arabs use up their oil."

In 2016, excluding the month of December, gross withdrawals of U.S. natural gas totaled 29,899,630 in millions of cubic feet, according to the U.S. Energy Information Administration. The annual total has been rising since the mid-1980s.

American Express shares dip after Munger comments on company
American Express shares dip after Munger comments on company

"Nobody else in America seems to feel my way, but I believe in deferred gratification," Munger said. "I don't think hastening to use our oil and gas is a good idea ... I don't see any advantage."

In January, the Organization of the Petroleum Exporting Countries produced over 32 million barrels of crude oil per day, according to secondary sources cited in OPEC's monthly oil market report. The cartel is composed mostly of Middle Eastern countries.

Munger is well known for being Warren Buffett's right-hand man and investment partner. Berkshire Hathaway's sixth-largest holding is in Phillips 66, which produces natural gas liquids and petrochemicals.

As Berkshire's only holding in the energy sector according to latest filings, Phillips' stock comprises 4.71 percent of its portfolio. Berkshire has held the position, which now comes to just under $7 billion, since the second quarter of 2012.