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Guyana’s Oil Exports Skyrocket—And Europe’s Refiners Love It

Energy News BeatExxon

  • Guyana’s oil production and exports are surging, with output exceeding 660,000 bpd and expected to reach 1.3 million bpd by 2030.
  • Europe is the biggest buyer of Guyana’s crude, with 66% of its exports heading there in 2024.
  • ExxonMobil and partners are expanding operations, planning gas-to-shore projects, increasing gas production, and considering LNG exports, further strengthening Guyana’s energy sector.

Five years after an Exxon-led consortium produced the first oil offshore Guyana, the country is pumping more than 600,000 barrels per day (bpd) of crude and has become South America’s fifth-largest oil exporter.

Guyana and ExxonMobil expect oil production to jump to 1.3 million bpd by 2030, which would double the current output volumes.

With higher production came a surge in Guyana’s crude oil exports in recent years. More than half of these are going to Europe, where refiners have been increasingly appreciating Guyana’s crude grades—Liza, Unity Gold, and Payara Gold. These crudes are sweeter and lighter compared to the crude of some other South American exporters, such as Mexico or Colombia.

Since the end of 2019, when Guyana exported its first crude oil cargo, the country has become the fifth biggest exporter in Latin America, after Brazil, Mexico, Venezuela, and Colombia.

Guyana’s plans for developing its burgeoning petroleum industry don’t stop with increasing its share of the global oil market.

The country and ExxonMobil are considering gas-to-shore projects to feed the fertilizer and aluminum industry and power and cool data centers.

While drawing up these plans for utilizing natural gas, Guyana is boosting its crude oil production and shipments.

Last year, Guyana’s exports jumped by 54% from a year earlier amid strong demand from Europe.

Crude oil exports averaged about 582,000 bpd in 2024, as ExxonMobil and its partners Hess Corp and CNOOC of China continued to boost production from the offshore Stabroek Block, where more than 11 billion oil-equivalent barrels have been discovered to date.

While drawing up these plans for utilizing natural gas, Guyana is boosting its crude oil production and shipments.

Last year, Guyana’s exports jumped by 54% from a year earlier amid strong demand from Europe.

Crude oil exports averaged about 582,000 bpd in 2024, as ExxonMobil and its partners Hess Corp and CNOOC of China continued to boost production from the offshore Stabroek Block, where more than 11 billion oil-equivalent barrels have been discovered to date.

Guyana already produces more than 660,000 bpd of crude from the Exxon-operated block. Production capacity in Guyana is expected to surpass 1.7 million barrels per day, with gross production growing to 1.3 million barrels per day by 2030, Exxon says.

Guyana is now the third largest per-capita oil producer in the world, according to the U.S. supermajor.

Surging oil production and exports helped Guyana’s economy grow by 43.6% last year, marking the fifth straight year of double-digit GDP growth, which began just as Guyana became an oil producer.

The oil and gas sector development is continuing, with Exxon considering additional projects to tap both the crude and natural gas riches offshore Guyana.

Exxon and partners expect to produce up to 1.5 billion cubic feet per day (bcfd) of natural gas and 290,000 barrels per day of condensate at the Longtail project, the consortium’s eighth project offshore Guyana, which will also be the biggest natural gas development in the prolific Stabroek Block to date.

Some of the more than a dozen discoveries in the Stabroek Block have good natural gas resources, and Exxon has decided it would develop these for gas-to-power onshore and potentially for LNG exports in the future.

Last month, Alistair Routledge, president and general manager at ExxonMobil Guyana, said that the supermajor plans to boost gas production in Guyana and could consider gas exports at a later stage.

By Tsvetana Paraskova for Oilprice.com

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Trump Energy Policies Reshape Renewables Sector

Energy News BeatTrump

  • The Trump administration declared a national energy emergency to accelerate fossil fuel development and imposed tariffs that increased costs for the renewable energy sector.
  • Negotiations between the US and Ukraine regarding Ukraine’s mineral reserves ended without an agreement, leading to the temporary suspension of US military aid.
  • The Renewables Monthly Metals Index saw a slight increase, while the Grain-Oriented Electrical Steel Monthly Metals Index experienced a decrease.

The Renewables MMI (Monthly Metals Index) moved sideways month over month, increasing a slight 1.86%. Meanwhile, renewable energy projects could face some challenges from a combination of tariffs and changing Federal policies.

Renewables MMI, March 2025

Trump Administration’s Energy Policies Reshape the Renewable Sector

Since taking power in January, the Trump administration has reshaped the U.S. renewable energy landscape by introducing some significant policy changes. So far, the White House has declared a national energy emergency, imposed tariffs on critical metals and rolled back environmental regulations.

Trump Declares National Energy Emergency

On January 20, 2025, President Trump signed an executive order declaring a national energy emergency. The move aims to accelerate fossil fuel development and eliminate regulatory barriers that slow energy infrastructure projects.

Supporters claim this move strengthens U.S. energy exports and creates jobs in the oil, gas and coal industries. However, critics argue that the decision prioritizes fossil fuels over renewables and undermines environmental protections.

New Tariffs Drive Up Renewable Energy Costs

The administration also implemented a 25% tariff on imported steel and aluminum to protect domestic producers. While the policy aims to boost U.S. manufacturing, it has raised some costs for industries that rely on these metals, including the renewable energy sector. For instance, wind turbine and solar panel manufacturers now face higher material expenses, which could slow renewable energy expansion.

The Trump administration also revoked pollution control rules that limited soot emissions from coal-fired power plants. By reversing these restrictions, the White House ensured older, high-emission plants can remain operational without costly upgrades. Industry advocates claim the decision supports the coal sector, but environmental groups warn that increased emissions could harm public health.

High-Stakes Negotiations Over Ukraine’s Mineral Reserves

In February 2025, U.S. President Donald Trump and Ukrainian President Volodymyr Zelenskyy engaged in critical discussions at the Oval Office in Washington, D.C. The meeting primarily focused on a potential deal that would allow the U.S. to tap into Ukraine’s vast critical mineral wealth. In exchange, Ukraine sought continued U.S. military aid amid its ongoing conflict with Russia.

Ukraine holds significant reserves of rare earth elements and lithium, with estimates valuing these untapped resources at approximately $500 billion.

Tensions Rise in Oval Office Talks

The negotiations took a bad turn during the televised meeting between the two leaders. As discussions progressed, Trump pressed for broader U.S. access to Ukraine’s mineral deposits.

Zelenskyy pushed back, stressing the need for fair terms and expressing concerns over the implications for Ukraine’s sovereignty. The talks ultimately collapsed without a formal agreement, prompting the temporary suspension of U.S. military aid to Ukraine.

Grain-Oriented Electrical Steel MMI

Grain-Oriented Electrical Steel (GOES MMI) dropped slightly month-over-month. In total, prices fell by 3.84%.

GOES MMI, March 2025

By  the Metal Miner team

 

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Will Trump Use the Federal Reserve as Leverage, Too?

Energy News Beat

ENB Pub Note: The Fed is a private company that behaves like the Federal Government. In my opinion, it has lost the trust of the American people. President Trump’s actions have indicated that he is looking to back the U.S. dollar with tangible assets and get away from printing money. With the Treasury sending out over 4 trillion dollars that are unaccounted for and the Fed not wanting to participate in an audit, this is shaping up to be a major shift in financial and fiscal policy. That may include eliminating the fed based upon President Trump’s actions and talking points. Will it be bumpy? Sure. Is it worth it to get rid of the corruption? Absolutely. Will the rest of the world have to “Man Up”? Yes, and they are not going to like it. 

When the next crisis hits, global markets may not be able to count on America’s financial backstop.

​Analysis

By , the founder of the Arbroath Group.

The United States’ unraveling defense commitments to Europe raise fundamental questions about geopolitical alignments, while U.S. President Donald Trump’s aggressive tariffs threaten a major reorientation of world trade. But there’s another set of risks lurking for global financial markets, which depend on reliable and ample dollar liquidity ultimately backstopped by the U.S. Federal Reserve.

As the only institution that can create dollars, the Fed has established swap lines to foreign central banks that have been critical in meeting sudden demand for dollars and calming global financial markets in times of panic. With an administration in Washington that likes to use support for foreign countries as leverage, can the vast market of dollar-denominated bonds, deposits, and currency swaps still count on the Fed when the next financial crisis hits?

The United States’ unraveling defense commitments to Europe raise fundamental questions about geopolitical alignments, while U.S. President Donald Trump’s aggressive tariffs threaten a major reorientation of world trade. But there’s another set of risks lurking for global financial markets, which depend on reliable and ample dollar liquidity ultimately backstopped by the U.S. Federal Reserve.

As the only institution that can create dollars, the Fed has established swap lines to foreign central banks that have been critical in meeting sudden demand for dollars and calming global financial markets in times of panic. With an administration in Washington that likes to use support for foreign countries as leverage, can the vast market of dollar-denominated bonds, deposits, and currency swaps still count on the Fed when the next financial crisis hits?

Today, the Fed’s support for foreign central banks is largely uncontroversial. And the Fed is formally independent from the White House. But institutional arrangements can be changed and traditional policies upended, especially by a president who likes to accumulate as much leverage as he can.

Consider the start of the COVID-19 pandemic. As countries shut down and economic activity seized up in early 2020, panicked investors all around the world raced for the safety of dollars and dollar-denominated assets. This skyrocketing demand for liquidity triggered a surge in short-term interest rates and a sharp strengthening in the dollar’s exchange rate.

To stave off the risks of cascading defaults in foreign markets that would surely reverberate in the U.S. economy, the Fed established swap lines with the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank. These facilities gave banks in these countries access to dollars through their own central banks. Temporary arrangements were also extended to the central banks of Norway, Sweden, Denmark, Australia, New Zealand, Mexico, Brazil, South Korea, and Singapore.

Consider, as well, the 2008 global financial crisis, when Armageddon seemed just one more insolvent bank away. Frozen U.S. and European credit markets threatened to set off a cascading series of defaults and even deeper global recession, or worse. The decision to extend swap lines to emerging markets like Mexico, Brazil, Singapore, and South Korea was an important departure at the time and a recognition that financial instability there could seriously damage the United States.

Now compare the list of countries the Fed has supported in recent financial emergencies with those the Trump administration has threatened, bullied, or slammed with tariffs over the past six weeks. They include Canada and Mexico on grounds of illegal immigration and drug enforcement, the European Union over trade imbalances, Canada and Denmark over territorial expansion, and Brazil over the status of the dollar as reserve currency. At the time of writing, the United Kingdom, Japan, and Switzerland have largely been spared, but that could change at any minute.

The Fed’s independence from the White House has been enshrined in law, as have the tools it chooses to deploy in support of its mandates to ensure price stability and full employment. This includes decisions to extend these swap lines, and the list of countries that qualified has been mostly uncontroversial. Indeed, the largest offshore dollar markets have mainly developed in the United States’ closest allies—or, more precisely, the countries Washington historically considered its allies.

The offshore dollar market actually dates back to the 1950s, when communist countries earning dollars on exports sought banks that could not be subjected to U.S. sanctions. British banks also lured dollar deposits across the Atlantic with higher rates than the Fed allowed. In recent decades, the U.S. government has welcomed the deep pool of global capital eager to buy mounting U.S. debt even as Washington officials remained nervous about the risks from so many dollars circulating beyond their regulatory control.

These days, demand for dollars outside the United States adds up to many trillions of dollars in loans, bonds, currency swaps, and other financial instruments. Foreign banks alone roll over obligations on a $16 trillion stock of bonds and deposits. Around $3 trillion are at U.S. branches and subsidiaries abroad that automatically have access to the Fed’s discount window, but the rest have to rely on their own central banks when liquidity disappears. Those central banks, in turn, rely on the Fed to backstop dollar liquidity in times of crisis.

In 2020, emergency swap lines added another $450 billion to a Fed balance sheet that grew to $7 trillion during the first three months of the COVID-19 crisis. These holdings carry minimal risk and earn the United States money: The Fed gets an equivalent amount in foreign currency as security plus interest accrued during the swap period.

But the Trump administration takes a narrower view of the United States’ global responsibilities, even as it takes a more flexible approach to the Fed’s independence. Recall that during the election campaign, Trump insisted that he could do a better job as Fed chair than the current incumbent, Jerome Powell. It doesn’t take much imagination to envision Trump threatening to withhold swap lines from allies perceived as uncooperative or ungrateful. Even if Trump doesn’t have the legal authority to fire Powell or force him to do his bidding, the attempt to block the Fed’s emergency rescue will shatter whatever market confidence might remain.

Imagine a financial crisis that hits as Washington is renegotiating the U.S.-Mexico-Canada Agreement, wrangling with the EU over German car exports, and pressuring Japan to buy more U.S.-grown rice. Bank failures that cascade through major markets might be stopped with the Fed’s trusty swap lines, but would the White House force the Fed to delay a decision for diplomatic leverage? Will Canada accept U.S. statehood to avoid financial collapse? Will Denmark hand over Greenland to save Europe’s banks? Will Japan have to buy more U.S. farm exports to save avoid a deeper recession?

The problem is that even without explicit threats, investors may run for safety before any backstops are deployed. Eventually, rising uncertainty over U.S. policy and the workings of U.S. institutions will extend even to the Fed—and raise the question of how it might respond to a financial crisis on Trump’s watch. Markets are already rattled by Trump’s remark this week that he doesn’t care as much about falling stock markets as many had expected. And the consequences may be far more immediate than any speculative worries about the dollar’s status as a reserve currency.

Just as doubts about the U.S. commitment to NATO undermine European security, doubts about the Fed’s reliability in a crisis threaten global financial stability. If Washington’s definition of enlightened self-interest has become as narrow as the last six weeks suggest, the United States’ reliability may be tested in markets long before it gets tested on a battlefield.

This post is part of FP’s ongoing coverage of the Trump administration. Follow along here.

Christopher Smart is the founder and a managing partner of the Arbroath Group, a former head of the Barings Investment Institute, and a former official at the U.S. Treasury Department, U.S. National Security Council, and U.S. National Economic Council. X: @csmart

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Week Recap: The State of U.S. Energy: Oil, Gas, and Policy Shifts Under the Biden Administration

Energy News Beat

Daily Standup Top Stories 

Chris Wright Moves to Refill The Strategic Petroleum Reserve

March 9, 2025 Clark Savage

Many people are curious about the Trump administration’s plans to refill the Strategic Petroleum Reserve (SPR) that was so callously abused by whomever was making decisions in the Biden administration, which drew this national security […]

Canada’s Final US Energy Tariff Warning to Donald Trump – “A Snow Mexican Standoff”

March 9, 2025 Clark Savage

ENB Pub Note: This will be a story to watch. When you ask Grok on X who will be affected, the response is; “The 25% electricity tariff from Ontario hits 1.5 million homes in Michigan, […]

UK Oil & Gas: Too Legit to Quit, Even for Labour

March 10, 2025 Mariel Alumit

The Labour government under Keir Starmer has upheld its promise to halt new oil and gas exploration but is now allowing tiebacks—connecting new reserves to existing fields. The government has decided not to renew the […]

The U.K. Pivot to AI Is Doomed From the Start

March 10, 2025 Stu Turley

Technology can’t provide the economic miracle Starmer wants. By David Gerard, the author of the book Attack of the 50 Foot Blockchain and the cryptocurrency and blockchain news blog of the same name. A government […]

Energy Sec To Shatter Biden’s Climate Shackles, Unleash U.S. Energy Boom

March 11, 2025 Mariel Alumit

Energy Secretary Chris Wright slammed Biden’s climate policies, vowing that the Trump admin will prioritize energy, prosperity, and scientific realism. ​Energy Secretary Chris Wright sharply criticized the Biden administration’s restrictive energy policies during a keynote […]

Cheniere gets FERC OK for two more Corpus Christi LNG trains

March 11, 2025 Mariel Alumit

FERC said in its approval dated January 10 it had a granted an application filed by Corpus Christi Liquefaction and CCL Midscale 8-9 in March 2023, requesting authorization for a second expansion of Cheniere’s Corpus […]

Highlights of the Podcast

00:07 – Intro

00:58 – Reserve Refill Begins

04:16 – Canada Warns Trump

06:40 – Strong UK Energy

08:33 – UK AI Struggle

10:47 – Energy Sec’s Policy Shift

13:22 – Cheniere LNG Expansion

14:52 – Oil/Gas Price $$

17:49 – Sheffield: PXD Out of Inventory

22:12 – Outro

Follow Stuart On LinkedIn and Twitter

Follow Michael On LinkedIn and Twitter

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Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.

Michael Tanner [00:00:07] what’s going on everybody welcome into a special weekly recap edition of the daily energy news beat stand up here on this gorgeous March 15th 2025 gorgeous Saturday we appreciate all of you who have stuck with us through the week if you had not had a chance to listen we have a great great recap episode lined up the team has gone through and found some great clips from the entire week do hold it held it down for a couple solo shows. We talked about Scott Sheffield and the tier one inventory. The team better put that one in this because man, unbelievable guys. We’ll keep that and we’ll keep this intro short so you can get to it guys. But as always, check us out, energynewsbeat .com. Thank you to sponsor the show, Reese Energy Consulting. And as always guys, investinoil .energynewsbeat .com to become Billy Bob Thornton from Land Man. But Stu, I’m gonna kick it over the team. We’ll see you on Monday folks.

Stuart Turley [00:00:58] The strategic petroleum reserve. This article came from one of my favorite guys on the planet. He is David Blackmon’s substack. This is an outstanding article on the SPR. And Michael, I just want to tell you that it was treasonous of the Biden administration to deplete the SPR because the SPR, the strategic oil reserve was created in the seventies by Congress. and Richard Nixon in response to the first Arab embargo but the Arab David points out very you know in this article the salt caverns and the storage system cannot handle much more it’s only good for two to four in and out refills and they’ve been using this as a piggy bank for votes to get the oil prices down So let’s go through some of the numbers real quick. So when you take a look at it, the SPR has a total capacity of 797 million barrels of oil, which is 33 days of U .S. consumption, but it’s about four months of U .S. crude imports because –

Michael Tanner [00:02:12] And I think that’s a critical piece to point out, that everyone says, well, it’s only 30 days of consumption. Yes, but we also make a majority of our own oil here, meaning that really what we’re trying to do is make sure that imports will go to zero. We’ve got a four to six month backstop, in this case four months.

Stuart Turley [00:02:33] And you’re having to understand that the reason that we import is to blend for our refineries because of the lack of investments in upgrading the refineries to being able to use our own oil. So when you take a look at that Biden people desperate to mitigate losses in the 2020 midterm elections chose to draw down the reserve to the 340 million barrels. Right now it only holds just around 395 million barrels. Now Reuters put out that it is going to take years and Chris Wright is looking at about 20 billion dollars to fill this. Could take 10 years. But I think legislation has to be put in where this is no longer a piggy bank for political gain.

Michael Tanner [00:03:25] well i completely agree with you the real question is what is doge think of this we’re trying to cut slice and dice everything out of the budget the question is are you gonna be able to find twenty billion if you need to take thirty percent of the budget and chop and chop thirty percent of the budget off are we gonna find twenty billion i would argue we need to the question is where is it going to come from what piggy bank is it going to come from i think we’ll be able to fight about it would be very interesting to see what you want to do it if they’re able to fit this in cuz i agree with you we need this it’s a critical for both national security uh… it’s critical for energy security about and i but i hope it doesn’t get acts when it when Doge comes around to it.

Stuart Turley [00:04:03] It’s going to be short -sighted. And so I think this is just as critical for president Trump in this house and Senate to get done as well as voting reform. I put these two equally up there. So let’s go to the next story here. You can’t buy this kind of entertainment, Michael. Canada’s final US energy tariff warning to Donald Trump. We’re filming this on Sunday morning. A snowy Mexican standoff, a snow Mexico standoff, Mexican standoff. I get tickled when everybody’s calling Canada and they snow Mexico. So here’s where it is. Doug Ford is the prime minister up there and we have a lot of customers that are going to be impacted on this. Canada will A 25 % energy flowing into parts of U .S., Ontario premier Doug Ford said as U .S. President Trump Ford plows on with his trade war, and I guarantee you, listen to this, the 25 % tariff from Ontario hits 1 .5 million homes in Michigan, New York, Minnesota. It’s a retaliation move against U .S. levies. Ontario’s premier Doug Ford is pushing ahead on Monday. Uh, this is going to affect grid reliability and I think it’s really stupid to get into a fight with president Trump.

Michael Tanner [00:05:30] yeah i i i do think that this is going to hurt energy prices i do think the markets are are in a little bit of uh… they’re a little bit in limbo right now with you know tariffs are on tariffs are off we’re going to do this then we’re going to do that really what what what the markets need is a signal this is what we’re going to do we’re going to stick to it if we’re going to put tariffs on stick with them the the idea that they’re on then they’re off then they’re back on like a high school relationship it does not give the markets the the clarity that it needs and we saw all last week not just with oil prices with the overall markets of itself they were up they were down really on the backs of a lot of this stuff so i really hope both can in the u s can come together come to some sort of agreement and if that’s a reciprocal tariff ten percent each going one way and going out i’m fine with that i’m not anti -tariff i am very anti on off on off of the again it’s like we’re in a high school relationship here

Stuart Turley [00:06:23] I couldn’t agree more, Michael, and I’m going to give President Trump a little bit of room because we’ve had 70 years of inequitable trade balances he’s trying to fix. So I’m willing to hang with him.

Michael Tanner [00:06:37] You’re siding with Trump?

Stuart Turley [00:06:40] Hey, let’s go to the Uk oil and gas, too legit to quit. The Labor government under Keith Starmer has upheld its promise to halt oil and gas exploration, but is now allowing tiebacks, connecting new reserves to existing fields. Seems like a sleight of hand here. When the Labor Party, Keith Starmer, won the latest Uk elections, it vowed to stop new oil and gas exploration. But if you’re in the general area and you think that there’s oil, they’re in such an energy crisis that you’re going to see this sleight of hand coming around. With the green energy policies, we see deindustrialization. With the green energy policies, I’m just releasing the george macmillan article and it is on if you go to energy newsbeat .co and then go to the upper left search for george macmillan you’ll see on there it’s called the 7p plan how the left got here from the 60s to now it is all part of the plan so if you think that you’re a green energy person you’re actually being manipulated it’s pretty cool to see that The government acknowledges that changes to the oil and gas fiscal regime in recent years have led to a period of uncertainty in the sector and its investors. Treasury said in a statement, this is the UK’s treasury, that part of the consultation part papers, yet another good sign for the UK’s energy. They’re going to stop the windfall profits tax after 2030. They’re not going to have an oil and gas industry by then. They’re absolutely going to go out. People are going to oil and gas companies are going to be fleeing the UK, staying in the UK for some entertainment. Let’s go to UK pivot to AI is doomed from the start. This is by David Gerard, author of the book, Attack of the 50 -foot Blockchain and Cryptocurrency and Blockchain News of the same title. This is pretty funny. Government bureaucracy generates paperwork, and even more paperwork, when it’s computerized. But human judgment is expensive. What if a computer could go through the paperwork instead? Well, I’m going to just say this right here. I like the idea. We’ve found that Doge has gone through the United States system, but it’s who is programming the AI. The AI that I’ve seen can be just as corrupt as people. Now if it’s a tool and it’s a search algorithm, so let’s say that you’re Nancy Pelosi. Just as an example, and you go out and you do an investment and you start going through in saying, how does this play in? AI can go through and then take a look at your bank account, cross reference, and do that kind of stuff, but it’s who’s driving that that you really have to take a look at to see whether or not corruption is going on. I think that this author has got some really good points on here. Starmer’s press release claims the International Monetary Fund estimates that AI will improve productivity by 1 .5 % per year. But this turned out to be far from an IMF report that was skeptical of Goldman Sachs report making this claim. The Goldman Sachs report says that electricity and personal computers raise GDP by this much. I’m going to throw this squirrel into this argument, and that is when you sit back and take a look at the amount of power that AI is going to take, the amount cost, the amount of development, the amount of data centers. And UK has been now urged with the left, you know, under the left’s policies and even their right wing supposedly conservative have been acting like left and they’ve been deindustrialized. So they are not going to have the money resources or the capability of implementing AI credibly. So buckle up for the UK or energy secretary. to shatter Biden’s climate shackles, unleash the US energy boom. Chris Wright is, again, the right man for the right job, and he is Chris Wright. So slam Biden’s climate policies, vowing that Trump will admin will prioritize energy, prosperity, and scientific realism. He characterized the Biden administration’s manical focus on the climate change as counterproductive and improvising ordinary people, pledging to take a radically different approach than his predecessor by unleashing U .S. and energy private sector. The previous administration’s climate policies are horrible. There are no winners in that world except the politicians and rapidly growing interest groups. the only interest groups that we’re concerned about with is the American people. Our focus is steadfast on the American people and our allies abroad. Chris Wright, I absolutely love that saying the only interest group that we are concerned about with is the American people. Oh my goodness, that is refreshing. The Trump administration will treat climate change for what It is a global. physical phenomenon. That’s a side effect of building the modern world. That’s an interesting way to put it. And I kind of agree with it. The Trump administration is moving forward and will end the Biden administration’s irrational, quasi -religious policies on climate change. And I think that this is going to be something that we’re going to see in the few months and that is additional graft and greed and corruption that net zero that the climate policies have done and they’ve been done intentionally. Yesterday I released the 7p podcast. It was the podcast where George Macmillan, and I talked about how we got here. And how we got here is by design since the 60s to turn this into the left plan, to turn this into a communist regime. And we almost failed hats off to secretary, right. And I really applaud him. You have to understand how we got here, but yet more importantly, how we’re going to get out of this problem. And I believe we’re on the right track. Cheniere gets the OK for two more Corpus Christi LNG trains. This is huge. FERC set its approval date at January 10th at a granted application filed by Corpus Christi Liquification and CCL mid -scale in March 2023. Man, since March of 2023 to get an approval process done? Hey, way to go Chris Wright. Clear off that desk. The applicants are authorized under section 3 of the NGA to site, construct, and operate the CCL mid -scale trains 8 and 9 project and described and conditioned. This is exciting. Chenier CEO Jeff Fresco recently commented that the company still expects to make final investment decisions to build two more mid -scale trains at Corpus. That’s exciting. Way to go, Chenier! And shout out to our sponsor, gotta pay the bills. The sponsor of the daily show is Steve Reese with Reese Consulting. He let me know that with all of the things going on and the growth in the LNG and natural gas space, that there is a training issue. And if your employees need training, reach out to Steve Reese at Reese Consulting, ReeseEnergyConsulting .com. They are fabulous, but if you are in looking to sell natural gas, if you’re looking to buy or put in a power plant, you need Reese Consult.

Michael Tanner [00:14:52] So markets are still open, but they’re up so far about a half a percentage point in the S &P 500 Nasdaq jumped about 1 .4 percentage points a lot of that’s because Tesla’s swinging back Heavily after getting pounded the last three or four days Two and ten year yields up eight tenths of a percentage point and four tenths of a percentage point respectively dollar index flat Bitcoin eighty two thousand dollars basically flat crude oil up about a dollar fifty to sixty seven seventy five That’s about two point two percentage points Brent oil basically flat at $71, and natural gas tumbles 7 percentage points to $4 .12. So natural gas guys go from happy to sad. It’s a tough business to be in that natural gas game. Myself, you know, when we go look at what’s driving oil prices, you know, it’s mainly tight U .S. supplies with the fact that we have seen crude oil inventories come back The EIA did drop their crude oil inventory report this morning, and they said that crude stockpiles rose by about 1 .4 million barrels, which is actually less than the expected 2 billion barrel bill that we saw the API drop yesterday. So remember what goes on there. We also did see gasoline inventories drop by about 5 .7 million barrels versus the expectation of a 1 .9 million barrel draw. Thank you. Thank you. pretty incredible on distillate stocks dropped a lot more good friend of the show Josh young said this week the oil build was smaller expected gasoline diesel draws were larger than expect this evidence stronger demand it could see oil prices rise as a result he was right there you know we did see inflation some numbers come out after see I US core CPI increase less than expected in February so that’s great we have seen a a pickup in the last few days but potential Russia Ukraine ceasefire Thank you very much. Um, but obviously with fears of recession that that’s going to hold obviously prices and any growth down, but so, you know, I mean, Stu, where are you at with, with, with the recession, you know, is it coming? Should we be worried? Should we not be worried? What do you think?

Stuart Turley [00:16:55] With Doge pulling out as much printed money as they can, that is a naturally occurring thing that will help inflation. Getting chickens to re -breeding and everything else, egg prices will come down naturally. as long as they don’t kill them. I think that if there is a recession, it was teed up by the Biden administration’s overprinting of money. I think that I like what I’m seeing with Chris Wright, Lee Zeldin, and Doug Burgum on all of the energy policies. I think we will see lower prices. We hit President Trump by saying we were going to have half the prices. I think in the red states, we will come close. In the blue states, rats are rucks.

Michael Tanner [00:17:43] yeah absolutely absolutely the only other thing i saw yesterday so we and we have to talk about this scott sheffield one that while now we can’t play the video cuz you to will take it down you’ll be able to watch it you know we’ll lose that that that thirty cents or whatever that we get per video wasn’t that wild? So would we, we, you know, guys, we’re a slim budget here. We had all we can take, but basically he goes on Scott Sheffield goes at a CNBC interview there at Sarah week. Okay. He joins power lunch and the quote Stu is unbelievable. I’ll give you basically the quote was at pioneer, we realized we were out of tier one inventory. and close to being out of tier two inventory. He goes on to say, tier one inventory will be done by 2028 and they’ll be out of tier two inventory by 2032. What? Unbelievable. This is from the same guy that four years ago was quoted as saying, we’ve got a pioneer had a hundred years of inventory. Oh, how the turntables. This guy just nuked. all over exxon stock i mean it’s pretty funny i mean throw out you know whether or not he’s right or wrong this is a revenge play for him in my opinion this is him in my opinion this is him looking at exxon mobile tape well you don’t want to stand up to you know for me when i’m getting left off your board when the f t c is coming after me unfairly well guess what i’m gonna go tell everybody your sixty three billion dollar acquisition was for Four years of inventory. and that’s an interesting thing to stop which socks cuz trust me there’s a reason why it’s called here to a not here one it’s because it’s off the beaten path are you only you only got bad stuff until twenty thirty two and then you’re absolutely cook i was shocked when i That’s an interesting take on it.

Stuart Turley [00:19:32] read this, Stu.

Michael Tanner [00:19:41] but but but what’s that gotta do you yeah because exxon realizes that they got fleeced with pioneer i mean is this the new x t o

Stuart Turley [00:19:49] Could be, but what I’m saying is that the amount of drilling activity, rigs, seismic activity What I’m saying is And everything going on in the Gulf is just going nuts.

Michael Tanner [00:20:01] I mean that’s like me coming out and saying with this show Yeah, we’ve only got about two years left of good shows and then it’s got that it’s gonna fall off a cliff

Stuart Turley [00:20:09] Yeah, Rats and Ruck finding a sponsor at that point.

Michael Tanner [00:20:11] Exactly, it’s gonna be rough finding people to pay. It’s just unbelievable. No, no, we’ve got a hundred years of good shows left.

Stuart Turley [00:20:18] Yeah, we got two million people listening to us already, so we have 8 .5 million transcripts read.

Michael Tanner [00:20:25] Now, on the other hand… On the other hand i think what scott sheffield said was the quiet part out loud there’s not as much great inventory left as people thought and without some technological change without some new innovation without something that is a complete game changer like horizontal drilling or the modern frack it’s going to be hard to find more shale oil i tend to fall in the camp of low prices and low margins leads to innovation Right. There’s the idea of creative destructionism. that industries when they when they tend to die out new people come in and find ways to revive them and increase those margins because now there’s opportunity to do so you know this doesn’t look this doesn’t boat this doesn’t bode well for anybody trying to sell right now i mean he really he really took and he really you know did a number on the m &a markets right now i mean double eagle and the boys over there must be thanking their financial advisors for making them sell out when they did because if they were in the midst of negotiations right now everybody would be re -evaluating every deal that’s in process right now there are in there they’re basically you know it’s it’s defcon one in these war rooms of them try to convince their buyers promise you we still got ten years of invig i mean it’s on believable

Stuart Turley [00:21:47] that still puts more importance on Alaska and the Pennsylvania area in the Marcellus and those kind of areas. I’m of the aspect that there is plenty of oil out there. It’s all financially whether or it’s accessible or permittable but there we are still short four trillion dollars of regular CapEx investment in order to maintain normal decline curves, Michael. I’m bullish on oil.

Michael Tanner [00:22:20] you know i i’m not as bullish issue you know i i i would be hard -pressed to see eighty dollar oil this year i don’t think we will and i think we’re gonna have to learn to live in a lower price in farm which the oil industry can i think you’d you’re gonna see a swing back from four -mile horizontal you know triple frac wells to something that’s a little bit more conservative plays that that you know i i think you’ll see conventional oil come back into in the swing a little bit one of the things i love that we’re doing with Pecos is that we’ve always lived in the conventional vertical space. Meaning we’re set up for times like this, but I mean, no, it’s, it’s, it’s pretty unbelievable. So, um, I

Stuart Turley [00:22:56] Like 32 % returns, by the way, just thought I’d share that

Michael Tanner [00:22:59] Yeah

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U.S. Rig Count Stalls as Oil Prices Keep Drillers in Check

Energy News BeatTrump

The total number of active drilling rigs for oil and gas in the United States held steady this week, according to new data that Baker Hughes published on Friday, following a 1-rig decrease in the week prior.

The total rig count in the US stayed at 592 rigs, according to Baker Hughes, down 37 from this same time last year amid the pervasive Drill Baby Drill sentiment of the Trump Administration, tariff wars, and sanctions.

The number of oil rigs rose by 1 to 487—down by 23 compared to this time last year. The number of gas rigs fell by 1 again this week to 100 for a loss of 16 active gas rigs from this time last year. Miscellaneous rigs (which could include exploratory drilling not targeting oil or gas, geothermal drilling, helium exploration, or even carbon sequestration wells) were unchanged at 5.

The latest EIA data showed that weekly U.S. crude oil production rose for the 6th week in a row, and is now at 13.575 million bpd. The figure is just 56,000 bpd shy of the all-time high reached during the week of December 6, 2024.

Primary Vision’s Frac Spread Count, an estimate of the number of crews completing wells, slipped during the week of March 7 to 210, compared to 214 in the week prior, and up from 201 at the beginning of the year.

There was a 3-rig slide in drilling activity in the Permian Basin, falling to 301 in the most proflic basin—a figure that is 15 fewer than this same time last year. The count in the Eagle Ford saw an decrease of 1 active drilling rig, coming in at 48. Rigs in the Eagle Ford are 7 below where they were this time last year.

Oil prices were trading up on Friday before the data release. At 12:29 p.m., ET, the WTI benchmark was trading up $0.48 per barrel (+0.72%) on the day at $67.03, just $0.14 per barrel off of last Friday’s price. The Brent benchmark was trading up $0.49 (+0.70%) on the day at $70.37—essentially unchanged from this time last week.

By Julianne Geiger for Oilprice.com

 

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Just 36 Companies Responsible for Half of Global Emissions

Energy News BeatCoal Demand

ENB Pub Note: Excellent article from Oilprice.com. Felicity points out some outstanding points about the 36 companies that are the world’s biggest carbon emissions producers. What is missing from this discussion is the definition of pollution. Is it the particulate matter in the air or the CO2? Under the worldwide Green New Deal definition that CO2 is a pollutant, we have seen a forced move to “renewable energy.” That “renewable energy” is neither renewable nor sustainable.

The control for CO2 should be changed to improving technology for removing of particulate matter that is pollution, like the microfibers from windfarm blades, or the coal plant emissions that don’t have the newest scrubbers on their plants. The latest technology on coal plants should be one of the most prominent export groups in the US. That would help lower emissions more than putting a tax on carbon or charging carbon credits that go into an account where the public does not see how it is dispensed.  

 

  • A recent analysis shows that half of the world’s carbon emissions are produced by only 36 companies, primarily major fossil fuel producers.
  • Despite global climate commitments, many of these large companies are increasing their production and emissions, hindering the achievement of the Paris Agreement’s goals.
  • There is a critical need for these top-emitting companies to significantly reduce their carbon emissions and invest in decarbonization efforts to mitigate climate change effectively.

Half of the world’s carbon emissions come from just 36 companies, according to a recent analysis. Countries worldwide have been battling to decarbonise their economies by investing in renewable energy and clean tech, moving away from fossil fuels, and reducing emissions from some of the most polluting industries. Despite their best efforts, it seems that the world may fail to achieve the 1.5-degree heating target outlined in the Paris Agreement climate accord unless the most polluting companies work to rapidly reduce their emissions.

The Paris Agreement is a legally binding international treaty on climate change, which was adopted by 196 Parties at the UN Climate Change Conference in 2015. The agreement aims to hold “the increase in the global average temperature to well below 2°C above pre-industrial levels” and pursue efforts “to limit the temperature increase to 1.5°C above pre-industrial levels.” Forecasts from the UN’s Intergovernmental Panel on Climate Change suggest that surpassing the 1.5°C threshold risks triggering far more severe climate change impacts, such as more frequent and severe droughts, heatwaves, and rainfall. Achieving the 1.5°C limit requires that greenhouse gas emissions peak before 2025 at the latest and decline 43 percent by 2030.

In recent years, governments worldwide have begun to invest in renewable energy and clean tech to reduce their reliance on fossil fuels and support a green transition. Several countries have also introduced carbon taxes and other incentives to encourage high-emissions-producing companies to decarbonise their operations. In addition to investing in low-carbon operations, supported by green energy and clean tech, many companies around the globe have invested in carbon offset schemes and carbon capture and storage technology to either mitigate or reduce their carbon emissions.

However, recent research from Carbon Majors – a database of historical production data from 180 of the world’s largest oil, gas, coal, and cement producers – suggests that the biggest polluters globally are not doing enough to reduce their carbon emissions, which could harm progress towards achieving the aims set out in the Paris Agreement. The analysis shows that around half of the world’s carbon emissions produced in 2023 came from just 36 companies.

The report showed that 36 major fossil fuel companies, including Saudi Aramco, Coal India, ExxonMobil, Shell, and multiple Chinese companies, contributed over 20 billion tonnes of CO2 emissions from their oil, gas, and coal operations in 2023. The figures for Saudi Aramco were astounding, showing that if compared to a country, it would be the fourth-biggest polluter globally after China, the U.S., and India. Meanwhile, ExxonMobil’s emissions were similar to those recorded for the whole of Germany.

Carbon Major’s figures show that most of the 169 companies in the database increased their emissions in 2023. Meanwhile, the International Energy Agency (IEA) has repeatedly stated the need to reduce the global reliance on fossil fuels to tackle climate change. The organisation said new fossil fuel projects that started after 2021 are incompatible with achieving a net-zero emissions outcome by 2050.

Emmett Connaire, at InfluenceMap, the think tank that created the Carbon Majors analysis, stated, “Despite global climate commitments, a small group of the world’s largest fossil fuel producers are significantly increasing production and emissions. The research highlights the disproportionate impact these companies have on the climate crisis and supports efforts to enforce corporate responsibility.”

A Carbon Majors report from April 2024 showed that just 57 fossil fuel and cement producers were linked to 80 percent of global fossil fuel carbon dioxide emissions since the signing of the Paris Agreement in 2015. Despite a broad knowledge of the high levels of emissions being produced by these companies, little has been done to push them to reduce their emissions.

The U.K. oil major BP, one of the private companies on the list of the biggest emitters, recently announced plans to cut its renewable energy investments and instead focus on increasing oil and gas production. This comes in spite of mounting pressure from international organisations and governments worldwide to decarbonise. BP said it planned to boost investments in oil and gas by around 20 percent to $10 billion annually, while reducing previously planned funding for renewables by more than $5 billion.

When it comes to state-owned companies on the list, several countries with some of the largest carbon-emitting companies have made pledges to decarbonise, to support a global green transition, including Saudi Arabia and The United Arab Emirates. However, Saudi’s Aramco was found to be the world’s biggest carbon emitter. The firm is estimated to be responsible for more than 4 percent of the entire world’s GHG emissions since 1965.

With just a few dozen companies producing most of the world’s carbon emissions, it demonstrates the dire need to restrict carbon-producing activities and encourage these oil majors to both invest in decarbonisation activities and diversify their energy mix. Many of the top 36 highest emitters are producing the same level of carbon emissions as entire countries, yet most are doing little to significantly reduce their emissions. If this trend continues, it may be impossible to achieve the climate aims outlined in the Paris Agreement, which could have devastating consequences.

By Felicity Bradstock for Oilprice.com

Is Oil and Gas An Investment for You?

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The Cost of Ignoring Geopolitics

Energy News Beat

ENB Pub Note: This is a fascinating look from an EU perspective on the current geopolitical issue facing the EU. What Jo Inge also points out is that the left in power mocked President Trump when he called out their dependence on cheap Russian natural gas and pointed out that a nation’s national security also includes energy security. Followers of our podcast have heard us talk about the left’s rise to power in the EU, and countries like Germany and the UK have decimated energy policies for the “renewable energy” that is neither renewable nor sustainable. We are discovering how much of a scam the “renewable energy” model is as we uncover the money trail. Germany’s removal of coal and nuclear pushed the EU’s largest economy into a crisis and deindustrialization.

How we go forward will be very interesting as Russia’s GDP grew 4% last year while the EU’s has been declining. President Trump is on the right track, but his team does not have all the information they need. The Biden Administration has stripped key sources and information out. Check out George McMillan’s ENB contributor page to see some of his ideas. I have talked with him on some of the solutions that the Trump team should be aware of to help end the Russian – Ukraine war and look at the geopolitical side of energy policies.

Like Napoleon and the Ming dynasty, Europe is paying the price for strategic blindness.

​By , a senior China fellow at the Norwegian Institute for Defence Studies.

Europe finds itself in the greatest peril since the 1940s. As Russia’s brutal war in Ukraine enters its fourth year, the Trump administration’s policy shifts mean that Europe suddenly faces the possibility of war with Russia without the United States’ full backing. Washington is now negotiating a possible peace directly with Moscow and Kyiv, without the participation of other Europeans. It also seems willing to reach a deal largely on Russia’s terms.

In addition, the Trump administration demands that any security guarantees to Ukraine be provided by European countries without U.S. backing, and it has signaled uncertainty about its willingness to adhere to NATO’s Article 5 commitments to help defend Europe in case of attack. This is a state of affairs that Europe’s armed forces are ill-prepared to handle.

Europeans could, of course, blame this development entirely on Russian President Vladimir Putin and U.S. President Donald Trump—and many of them do. But at the end of the day, Europeans must acknowledge that they are now paying the price for their own geopolitical ignorance.

History abounds with examples of leaders turning a blind eye to geopolitics, for which their nations eventually paid a heavy price. French Emperor Napoleon Bonaparte neglected the challenges of geography when he invaded Russia in 1812, with his army’s devastating losses there contributing to his final defeat at the Battle of Waterloo three years later. Nazi Germany committed a similar mistake, setting in motion its own downfall when it invaded the Soviet Union in 1941, exposing itself to a two-flank war.

On the level of grand strategy, China’s Ming dynasty committed one of history’s most momentous geopolitical mistakes when it abandoned seafaring in the mid-15th century.

In the 14th and early 15th centuries, China put to sea the most powerful and majestic fleet that the world had ever seen, fully dominating the trade routes in the Indian Ocean and the Western Pacific. Yet from the 1430s onward, just as European shipbuilding and navigation skills were on the rise, the Chinese emperors reduced their support to shipyards and banned most ocean-going trade. As a result, European navies would dominate Asian waters for the next five centuries.

Europe has failed to learn from these examples—and ignored three distinct geopolitical developments.

First, Europe has largely shut its eyes to Russia’s reemergence as an imperial power, which is the most important and far-reaching geopolitical development directly affecting Europe since the end of the Cold War. Like the Ming emperors who scrapped their navy, the Europeans literally abandoned geopolitics. For almost two decades, they developed a force structure more suited to fight insurgents in the mountains of Afghanistan and frighten off pirates in the Gulf of Aden than defending the European homeland. Europe could afford to take its holiday from geopolitics and ignore Putin’s growing assertiveness for one simple reason: the security guarantee extended by the United States.

Second, Europe has failed to acknowledge the geopolitical logic of China’s rise, which will ultimately force the United States to rebalance its military posture toward the Indo-Pacific. In 2011, when the Obama administration first announced a U.S. “pivot to Asia,” only two European countries were fulfilling NATO’s pledge to spend at least 2 percent of GDP on defense. A decade later, in 2021, only four additional European NATO members had managed to reach this threshold.

One important reason for this lack of response was the United States’ apparent suspension of the pivot to Asia when it moved troops to Eastern Europe and warships back into the Atlantic in response to Russia’s 2014 invasion of Ukraine’s Crimean Peninsula. At the time, many people who I talked with in the European strategic community seemed to believe that Washington had permanently pivoted back to Europe. However, they ignored that the U.S. rebalance to Asia is driven by the strongest and most irresistible forces in international relations: the balance of power and a fear of expanding hegemons.

China’s defense spending of $309 billion in 2023 was larger than that of the rest of East Asia plus South Asia combined, meaning that China could easily dominate the region if the United States withdrew its military presence there.

The situation in Europe is very different. The Russian economy is smaller than Italy’s in terms of nominal GDP, and it and lacks key technological and manufacturing capacities; any inability of Europeans to deter and contain Russia is entirely due to European leaders’ past and present unwillingness to do so. This difference in the Asian and European balances of power helps explain Washington’s ongoing flirtation with the Kremlin. A settlement of the Russia-Ukraine war would enable a more comprehensive U.S. military rebalance to Asia.

The third geopolitical development that Europe has ignored at its own peril is the Sino-Russian partnership, its inherent strategic logic, and the value that both countries place on it. China’s economic rise has enabled Russia to diversify its trade relations and reduce its dependency on Europe. This has been particularly important for Russia since 2014, when the West first imposed economic and financial sanctions in response to the annexation of Crimea.

Moreover, despite being the junior partner, Russia knows that China is preoccupied with its rivalry with the United States in the Pacific, which mitigates Moscow’s threat perception of Beijing. Indeed, Russia would not have undertaken a full-scale invasion of Ukraine with an unfriendly China on its Asian flank. For China, good ties with Russia are driven even more strongly by geopolitics and considerations about the balance of power. Having Moscow on its side could give Beijing an edge in its superpower rivalry with Washington.

In sum, Russia’s return to imperialism, the U.S. shift to Asia, and the China-Russia partnership should have provided European leaders with valid reasons to rethink their continent’s security arrangements, but they did not. We are so used to thinking of Europeans as living in their holiday from history that we are less surprised by their ignorance of geopolitics than we should be.

After all, the major European powers used to be masters of strategy. The school of realism in international relations theory, with its strong focus on the balance of power, largely builds on studies of the European great powers. At the height of the British Empire in 1848, then-Foreign Secretary Lord Palmerston famously declared in the House of Commons that “[w]e have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow.” Palmerston’s advice would have served European leaders well in recent decades.

Europe’s strategic blindness has various causes, including a leadership class lacking in vision and wisdom. But I would like to stress two other explanations. One important reason is that European nations moved from being masters of strategy to being strategic subordinates of the United States. This has arguably been the case ever since the 1956 Suez crisis, when the United States forced Britain and France to backpedal from their attempt at invading Egypt and controlling the Suez Canal.

While European governments have voiced their dissent on various U.S. policies in the years since, such as the U.S. invasion of Iraq in 2003, they remained second-tier states in an alliance with a superpower. As such, they have been more concerned about being good allies and keeping Washington engaged in Europe than they have been about developing their own strategic capabilities.

Another reason for Europe’s strategic ineptitude is the almost exclusive focus on rules and multilateralism in contemporary European thinking. The paradigm shifts between rules-based liberalism and balance-of-power realism as the dominant force informing state behavior has been a recurrent theme in international relations. With the collapse of the Soviet Union, Europeans strongly believed that the conditions had finally arrived for German philosopher Immanuel Kant’s idea of eternal peace based on democracy, free trade, and the institutions that would rein in power politics. This post-Cold War optimism was not unique to Europe, but it was more dominant in Europe than in any other corner of the world.

When liberalism became not just the prevalent paradigm but a moral imperative, advocates of geopolitical realism, with their emphasis on the balance of power, were often disregarded as the horsemen of the apocalypse. They became objects of derision, as when German officials laughed at Trump warning them in 2018—as others had warned before—that energy dependence on Russia was a dangerous strategic mistake.

So, where should Europe go from here? In order to avoid the fate of the Ming dynasty, whose mistakes would haunt China for centuries, Europe urgently needs a grand strategy with a coherent view on security, democracy, and economics. Given the continent’s fragmented politics and lack of clear leadership, this is a tall order.

In terms of security, the Ukrainians’ brave war of resistance has weakened Russian military capability to such an extent that defense analysts estimate that Europe probably has a five– to 10-year window to bolster its military capabilities before Russia has fully restored its losses.

Even though Trump’s policies likely forever changed Europe’s view of the United States, trans-Atlantic ties may not be completely ruined. Rather than trying to develop an independent defense concept linked to the European Union, Europe is better served by maintaining relations with the United States within the NATO framework. However, Europe should aim for a “reversed NATO,” where Europe, not the United States, is the dominating force within the alliance.

Even as it maintains trans-Atlantic relations, Europe should enhance its strategic autonomy to such an extent that it is capable of surviving U.S. abandonment. Europe also needs to be strong enough to avoid alliance entrapment, whereby the United States demands that European nations to do its dirty work in out-of-area missions that run counter to the continent’s interests.

Europe’s challenges go beyond security. Europe’s democratic governance model is now under severe threat—from within as well as from Russian and U.S. interference. Finally, as Mario Draghi’s recent report on EU competitiveness so eloquently pinpointed, the European economy is also in shambles. Indeed, a newly published U.N. Industrial Development Organization report estimated that by 2030, Europe’s manufacturing powerhouse—Germany—will account for only 3 percent of global industrial production (down from 8 percent in 2000), while China will control no less than 45 percent (up from 6 percent in 2000).

In order to retain democracy’s attractiveness for citizens and build a solid defense structure capable of deterring Russia, Europe must swiftly revitalize its economy. If the United States is no longer willing to partner with Europe economically as in other areas, then European leaders must look to bring the United Kingdom back into the EU, develop the continent’s links with Africa, and reconsider its relationship with China.

Only serious, concrete, and fast changes along these lines, rather than yet more summits and speeches, will show that Europe has woken up from its long geopolitical slumber.

Jo Inge Bekkevold is a senior China fellow at the Norwegian Institute for Defence Studies and a former Norwegian diplomat.

 

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Biden’s Water Heater Regs Threatens U.S. Jobs, Exempts Foreign Models

Energy News Beat

Biden’s regulation on tankless water heaters could harm U.S. manufacturing by exempting foreign-made models, threatening American jobs and consumer choice.

​

natural gas heating
Right after Christmas, Team Biden, in an effort to put an exclamation point on its sad, pointless climate agenda, finished a regulation that set new efficiency standards for gas tankless water heaters and effectively eliminated the lowest-priced versions of these water heaters. [emphasis, links added]

This regulation, finished just as a dying administration walked out the door, was exactly what the Congressional Review Act [CRA] was designed to address. The act allows Congress and the president to strike down recently established rules.

In this instance, there is more to the story that should give pause to anyone who cares about American jobs.

The National Appliance Energy Conservation Act, approved in 1987, requires that household appliances meet efficiency standards and that the Department of Energy periodically review and, if needed, update the standards.

The Energy Department started such a review of water heaters in 2021.

The process is more complicated than you might think. There are different kinds of water heaters: traditional storage tank heaters that heat and store 30 to 80 gallons of water and tankless water heaters that heat water as it passes through the pipes.

For whatever reason, Team Biden issued two regulations for water heaters: new standards for traditional storage tank water heaters in May and new standards for tankless water heaters on Dec. 26.

Only the standards for tankless water heaters are within the time frame the CRA sets for reviewing new rules. As a consequence, only those standards are subject to congressional review.

In a rational world, the fact that Congress can disapprove of only one of these rules when both deal with water heaters would be enough to kill the idea.

Who would be loopy enough to want different regulations for the same appliances? Unfortunately, Congress is not always rational.

This story has one additional unhappy twist. About 80% of water heaters sold yearly in the United States are traditional storage tank heaters manufactured by U.S. companies. Almost all tankless water heaters are manufactured in foreign nations, mostly Japan, South Korea, and China.

That means if Congress goes ahead with the resolution of disapproval, American-made water heaters will be subject to new rules while primarily imported water heaters will not.

Tankless water heaters could be permanently exempted from regulation because the CRA precludes any attempt to impose regulations that are “substantially the same” as those Congress has rejected.

We can all agree that subjecting the best, most affordable, and most popular appliance — the one that has been made in the U.S. for decades — to onerous regulation while exempting foreign-made products from any regulation at all is neither wise nor aligned with any vision that places American companies, American workers and American families first.

I am a big fan of the CRA and was fortunate enough to work on it when it went through the legislative process in 1996.

However, the CRA is the wrong tool here, and it will lead to bad outcomes for American companies and workers. Congress should do nothing in this instance.

A lawsuit has been filed in federal court seeking to invalidate the tankless water heater rule. The administration should settle that case and send the rule back to the Department of Energy for further review. Energy Secretary Chris Wright has said he wants the rule returned to him so it can be fixed.

Once the Energy Department receives the rule, it can invalidate Team Biden’s rule, treat tank and tankless water heaters the same, and protect American manufacturing, consumer choice, and workers.

Read rest at Washington Times

 

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China, Russia, and Iran Hold Nuclear Talks

Energy News Beat

 

High-level diplomats urge Washington to lift nuclear sanctions on Tehran.By , the World Brief writer at Foreign Policy.

 

Sanctions Pushback

High-level officials from China, Russia, and Iran convened in Beijing on Friday to call for an end to U.S. sanctions on Tehran over its advancing nuclear program.

“[T]he relevant parties should be committed to addressing the root cause of the current situation and abandoning sanction, pressure, or threat of force,” Chinese Vice Foreign Minister Ma Zhaoxu read from a joint statement, adding that dialogue based on “mutual respect” is the only viable path forward.

Chinese Foreign Minister Wang Yi proposed a five-point plan for “the proper settlement of the Iranian nuclear issue.” His proposal includes ending sanctions, restarting multinational talks, and using the 2015 Iran nuclear deal as the basis of future negotiations.

The proposal is likely to face U.S. pushback. President Donald Trump withdrew Washington from the 2015 deal during his first term, arguing that it was not restrictive enough on Tehran’s nuclear program and that the sanctions relief that it provided was enabling Iran to fund its proxy groups, such as Hamas and Hezbollah.

Trump wrote to Iranian Supreme Leader Ayatollah Ali Khamenei last week in an effort to jump-start new talks. “There are two ways Iran can be handled: militarily, or you make a deal,” Trump said at the time. And on Thursday, the Trump administration issued new sanctions on Tehran as part of the U.S. president’s “maximum pressure” strategy, which is aimed at forcing Iran back to the negotiating table.

But Iran’s leadership seems disinclined to talk to Washington. “When we know they [the United States] won’t honor it, what’s the point of negotiating?” Khamenei said on Wednesday, adding to previous comments that he is not interested in talks with a “bullying government.”

Iranian Deputy Foreign Minister Kazem Gharibabadi maintained on Friday that the country’s nuclear program is “peaceful in nature.” But the International Atomic Energy Agency (IAEA) remains concerned. According to the IAEA’s most recent quarterly reports, Iran now enriches uranium at up to 60 percent purity. The agency believes that within a few weeks, Iran could reach the 90 percent weapons-grade level enrichment threshold. Under the 2015 nuclear deal, Iran was only allowed to enrich uranium up to 3.67 percent purity.

A closed-door meeting this week with six members of the United Nations Security Council to discuss Tehran’s nuclear program drew ire from Iran, which said that the session was a “misuse” of the council’s purpose. Yet as FP’s Lili Pike noted, Iran was willing to participate in Friday’s nuclear talks in Beijing with China and Russia, as both are close partners of Tehran’s.

As for why China is taking such a direct interest in nuclear diplomacy with the country right now: “The potential risk of a military conflict over the Iranian nuclear crisis could introduce so much regional instability and chaos that could further disrupt China’s geo-economic and geopolitical interests,” Tong Zhao, a senior fellow at the Carnegie Endowment for International Peace’s nuclear policy program, told Pike. “More nuclear confrontation among more nuclear-armed countries is not necessarily good news for any future leader of the international system,” Zhao added.

 

The post China, Russia, and Iran Hold Nuclear Talks appeared first on Energy News Beat.

 

Will Economic Detox Lead to a Recession? Maybe Not. But a Long Deep Stock Market Rout Will (See Dotcom Bust)

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“We’re focused on the real economy,” Bessent said. “Ouch,” stocks said. Where did the Trump put go?

By Wolf Richter for WOLF STREET.

One issue is, how do you get an economy addicted to government deficit spending off this drug?

Another issue is, how do you get Corporate America addicted to cheap labor overseas off this drug?

The US has two huge structural deficits: The fiscal deficit and the trade deficit in manufactured goods – the “twin deficits.” Both are massive long-term problems and need to be addressed by sending the economy and Corporate America into “detox,” as this is now called, but it’s going to ruffle some feathers, especially of stocks.

And a third issue is worming its way into the detox conversation: The stock market has gotten addicted to the government’s deficit spending, to the fat profit margins from offshoring production, and to the Fed’s erstwhile free-money policies, including trillions of dollars in money-printing, of which $2.2 trillion have so far been un-printed via QT.

They’re saying the right things, but it’s OUCH for stocks.

“The market and the economy have become hooked, become addicted, to excessive government spending, and there’s going to be a detox period,” Treasury Secretary Scott Bessent told CNBC last Friday.

“There’s going to be a natural adjustment as we move away from public spending to private spending,” he said.

When asked if “detox” was a euphemism for a recession, Bessent told CNBC: “Not at all. Doesn’t have to be because it will depend on how quickly the baton gets handed off,” he said. “Our goal is to have a smooth transition.”

“If you start looking at micro horizons, stocks become very risky”: Bessent.

“We’re focused on the real economy,” Bessent told CNBC on Thursday. They want to “create an environment where there are long-term gains in the market and long-term gains for the American people,” he said. “I’m not concerned about a little bit of volatility over three weeks.”

“The reason stocks are a safe and great investment is because you’re looking over the long term. If you start looking at micro horizons, stocks become very risky. So we are focused over the medium-, long-term,” he said.

“I can tell you that if we put proper policies in place, it’s going to lay the groundwork for a both real income gains and job gains and continued asset gains,” he said.

So where the heck is the Trump put?

“There’s no put,” Bessent said. “The Trump call on the upside is, if we have good policies, then the markets will go up.”

Trump agreed. They’re singing from the same hymn sheet. “You can’t really watch the stock market,” Trump told Fox News last Sunday.

“Markets are going to go up and they’re going to go down,” Trump said on Tuesday from the Oval Office.

Tariffs might cause “a little disturbance, but we’re OK with that”: Trump.

“There will be a little disturbance, but we’re OK with that. It won’t be much,” Trump told Congress to address the side effects of imposing tariffs to encourage companies to manufacture more in the US. Fact is, modern highly automated manufacturing provides huge and important long-term benefits for the economy, including secondary and tertiary benefits.

In terms of the inflationary impact of tariffs, Bessent said that inflation is defined as a persistent increase in prices across a wide variety of goods and services over time, but “the tariffs are a one-time price adjustment.”

How much of that adjustment will make it all the way through to consumer prices is unknown. Automakers, including BMW, have already said that they will have to eat the tariffs because they cannot raise prices without losing sales. That’s why they hate tariffs so much. They wouldn’t mind tariffs if they could pass them on.

That’s what happened last time; they tried to raise prices, but then lost sales and had to roll back those price increases. Inflation is measured by transaction prices, not fantasy sticker prices, and when people don’t buy at higher prices, but buy from a competitor at lower prices, it’s the actual purchases from the competitor that go into inflation measures.

Consumer durable goods would be hit the most by tariffs. This is CPI for durable goods, shown as price level. There is no visible impact of tariffs in 2018 and 2019:

Even if a portion of the tariffs will get passed on to consumers, given that the economy is now in an inflationary environment, that portion, as Bessent said, will be a one-time bump.

When will a stock market rout trigger a recession?

Tariffs are a tax on corporate profit margins that may be difficult to pass on, so tariffs hit stocks, and they did last time: The S&P 500 tanked 20% in 2018. But it didn’t trigger a recession last time, not even close.

But last time, inflation was below the Fed’s target, and the Fed pivoted in December 2018 when it suggested that the rate hike might have been the last one in the cycle, and it was. That was the Fed’s put perhaps. And Trump had been hyping the Dow incessantly, and he had been keelhauling Powell on a daily basis publicly to end the rate hikes and stop QE. That was the Trump put.

But this time around, inflation is well above the Fed’s target, it’s sticky and stubborn and over the past six months has been accelerating again, and the Fed pivoted at the December meeting from rate cuts to wait-and-see.

At the same time, Trump and Bessent are brushing off concerns about the market: They’re going to fix the real economy, and they’re going to fix the US fiscal nightmare – I mean, good luck, but that’s what they’re saying – and detox can be painful, and so be it.

There is a huge amount of recession talk once again, just like there was in 2022 and 2023.

For the NBER to call out a recession, there would need to be a broad-based economic decline (not just slower growth) and a decline in the labor market.

Measures of the labor market, including weekly measures, are doing just fine. Real GDP growth in Q4 came in at 2.3%, higher than the 15-year average for the US. It was driven by very robust consumer spending growth. In January, retail sales always plunge from December, and huge seasonal adjustment factors are used to iron out the spike in December and the plunge in January. Year-over-year, which eliminates seasonality, January retail sales jumped 4.8%. But seasonally adjusted, from December to January, retail sales declined by 0.9%, likely due to slightly off seasonal adjustment factors (I discussed this here).

But one thing we know from the past – and this may be even more the case now – a stock market rout after a majestic bubble, if deep enough and long enough, will trigger a recession.

We saw that during the Dotcom Bust. The S&P 500 plunged 50% and the Nasdaq plunged 78%, and it triggered a recession. In parts of the US that are depending on the stock market, it triggered a hard recession. In other parts of the country, there was barely a ripple. And it averaged out into a run-of-the-mill national recession.

The biggest spenders – the people with the money to spend freely – always have a large impact on consumer spending. But they also have a large impact on business decisions.

Their wealth is largely tied to stocks, outright company ownership, cryptos, etc. When they lose 30% or 40% or 50% of their net worth, they’re going to get nervous. This includes people with regular jobs, 401ks, and stock options, and people who are business-decision makers.

Many of them have been irrationally exuberant about their stocks and cryptos and real estate and whatnot, after years of huge gains. And if they watch their wealth go up in smoke, they might react, and their decisions move the needle in all kinds of ways:

  • As households, they may spend less extravagantly (the reverse “wealth effect”), which will ripple through the economy as businesses react with less investment and spending, and with job cuts.
  • As business decision makers, they may batten down the hatches of their businesses: cut spending, cut investments, reduce hiring, and increase layoffs.

For these reasons, a deep sustained rout in the stock market will eventually trigger that recession. But where is the line?

Will the S&P 500 have to drop 40%? 50%? And for how many years? The Dotcom bust took about 30 months to play out, from mid-March 2000 until early October 2022. The rout sandwiched a recession from March 2001 to November 2001. It took a year after the recession ended for stocks to finally bottom out.

Now, stocks are trading at very precarious levels. They’re very vulnerable for a major drawn-out rout. And the puts that the market had assumed were there to provide a floor may no longer be there.

And maybe there won’t be that kind deep drawn-out stock market rout of the type that occurred during the Dotcom Bust. And then there may not be a recession at all.

But even if a stock market rout comes along that is deep enough and long enough to trigger a recession, that short-term price may well be worth paying for the long-term benefits of sorting out the US fiscal mess and of increasing manufacturing in the US.

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The post Will Economic Detox Lead to a Recession? Maybe Not. But a Long Deep Stock Market Rout Will (See Dotcom Bust) appeared first on Energy News Beat.

 

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Pecos Country Operating, LLC is a privately owned oil and gas exploration and production company headquartered in Fort Worth. We own and operate wells across the South Central United States with our predominant means of production coming out of West and North Texas.

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