WHAT’S HAPPENING TODAY: Good afternoon and happy Thursday, readers! In today’s Daily on Energy, we give you some insight into how oil producers are responding to President Donald Trump’s “drill baby, drill” agenda.
Continue reading to see what some Senate Republicans are saying about the administration’s efforts to hinder wind and solar development.
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Welcome to Daily on Energy, written by Washington Examiner energy and environment writers Callie Patteson (@CalliePatteson) and Maydeen Merino (@MaydeenMerino). Email cpatteson@washingtonexaminer dot com or mmerino@washingtonexaminer dot com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
‘WAIT, BABY, WAIT’ – LOW CRUDE PRICES TO CURB MORE DRILLING: Oil producers and drillers in Texas are throwing cold water on the Trump administration’s goals of ramping up drilling of oil and natural gas, saying the president’s own policies getting in the way.
Growing concerns: Recently released oil market reports have affirmed that supply is still outpacing demand. And for those in oil producing regions like the Permian Basin, there is no clear sign that will change any time soon, as the projected 12-month average price for crude (also known as the 12-month strip) sits around $61.50 per barrel.
“That is not a good price that these oil and gas guys that are drilling in the Permian want to see,” Kirk Edwards, an Odessa oilman and former chairman of the Permian Basin Patrol Association, told Callie, adding “It is very marginal to try to drill a well with these prices. If this continues, you’ll see even more drilling rigs start coming down.”
As of last Friday, there were nearly 50 fewer rigs active in the U.S. than at the same time last year. For many, this is evidence that President Donald Trump’s promise to “drill, baby, drill” cannot be met under existing market conditions.
“Our term right now is ‘wait, baby, wait,’” Edwards said. “Nobody is going to go out and drill at this price.”
Some growth: While there is growing sentiment among drillers that increased production is out of reach, there are still some optimists in the industry. Karr Ingham, president of the Texas Alliance of Energy Producers, pointed to the fact that drillers have still been able to maintain or slightly increase production levels in the last year. Earlier this month, the EIA reported that crude production hit a record high of 13.49 million barrels per day in May.
However, most are not expecting to see record levels stretch into the rest of the year or next, particularly as Trump’s tariffs on steel and aluminum have raised supply chain costs.
“These tariffs are doing nothing to strengthen the demand picture. I promise you that, if anything, they’re only weakening the demand picture,” Ingham said, noting that he does appreciate the administration’s favorable stance towards the industry when compared with its predecessors. But regulatory reform isn’t enough.
“The tariff situation is troublesome for oil and gas. It raises costs directly to them, and then it causes economic uncertainty, which affects demand for what they produce, which is all mattering right now, because you don’t have demand growth, may not have demand growth at all, and if you do, it’s not sufficient to compensate for the supply growth,” he said.
Edwards agreed, saying, “A lot of the policies right now that were supposed to be helping our American energy industry are really hurting it. And I hope the administration wakes up to that at some point.”
When asked if Secretary Doug Burgum, as the chair of the National Energy Dominance Council, had any response to the growing criticism, the Interior Department referred Daily on Energy to past remarks made by the secretary on permitting, wind, and coal.
Where prices stand: After declining all week, oil prices began to slightly tick up today by just over $1. As of 2 p.m. EST, international benchmark Brent Crude increased 1.65% (roughly $1.08) and was selling at $66.71 per barrel. West Texas Intermediate also jumped by 1.90% ($1.19) and was priced at $63.84 per barrel.
SENATE REPUBLICANS ASK ADMINISTRATION NOT TO ‘SUFFOCATE’ RENEWABLES: Two top Republicans in the Senate are pushing back against the Trump administration’s effort to stymie wind and solar development, insisting that the U.S. will need every available electron to support the president’s own policies.
Recent remarks: Sens. Lisa Murkowski of Alaska and Chuck Grassley of Iowa took to social media yesterday promoting the “all of the above” energy strategy previously embraced by Trump. The administration has seemingly abandoned this strategy, imposing policies making it more difficult for wind and solar projects to begin construction in the U.S. Trump himself has even vowed to prevent any new wind turbines from being built.
Grassley has taken issue with these recent policies and regulations, writing on X, “Energy dominance means ALL of the above & all of the below energy components Unleash American energy don’t suffocate it thru extra govt regs.”
Murkowski agreed, writing, “Taking electrons off the grid is just as fundamentally misguided as keeping energy in the ground. We need it all, and our policies must reflect that.”
Credit phase-outs: The Republicans’ comments come just days before the Department of Treasury was poised to release guidance on how to enforce the phase-out of renewable subsidies as ordered under the One Big Beautiful Bill Act. The bill ends tax credits for wind and solar projects placed in service after 2027, but includes a carveout for projects that begin construction within 12 months of the bill being enacted.
Given the administration’s accelerated crackdown on the industry, some fear that the Treasury could take that language further, preventing any projects from qualifying for the subsidies. Grassley appears to share those fears, announcing earlier this month that he would be placing a hold on three of Trump’s nominees to the agency.
“Until I can be certain that such rules and regulations adhere to the law and congressional intent, I intend to continue to object to the consideration of these Treasury nominees,” Grassley said at the time.
The Treasury Department is expected to release the guidance as early as Monday.
KEEPING FOSSIL FUEL PLANTS OPEN COULD COST BILLIONS: The Trump administration’s efforts to keep large fossil-fuel power facilities from retiring could end up costing ratepayers upward of nearly $6 billion annually starting in 2028, according to a new report.
The details: The report was released this morning by a number of environmentalist groups including Earthjustice, the Environmental Defense Fund, the Sierra Club, and the Natural Resources Defense Council. These groups, which have sued the Trump administration over its efforts to prop up the fossil fuel industry, insist that keeping aging coal plants will increase electricity costs.
The report found that nearly 35 gigawatts worth of large fossil fuel plants are scheduled to retire between now and 2028. If all of these facilities are saved from retirement, the report claims, it would cost ratepayers at least $3.1 billion. And if even more power plants are kept open, it could cost as much as $5.9 billion.
“Households and businesses shouldn’t be paying billions out of pocket to keep aging, costly fossil fuel plants on life support, but that’s the path the Trump administration is taking us down,” Ted Kelly, director and lead counsel for U.S. clean energy at EDF said in a statement. “This report confirms that the Department of Energy’s unlawful mandates amount to a self-inflicted rate hike in nearly every region of the country.”
Some background: The report comes as the Trump administration has vowed to extend the life of aging coal plants set to retire in the next five years. Most recently, the Department of Energy ordered a coal plant in Michigan to operate five weeks past its planned retirement date. Consumers Energy, which operates the facility, revealed earlier this month that keeping the plant open during that period cost around $29 million.
NASA TO SET ASIDE CLIMATE SCIENCE PRIORITIES: Transportation Secretary Sean Duffy, who is serving as interim NASA administrator, has said NASA will be setting aside all priorities related to climate science pushed under the Biden administration, shifting its focus back to “exploration.”
“All of the climate science and all of the other priorities that the last administration had at NASA we’re gonna move aside, and all of the science that we do is gonna be directed toward exploration,” Duffy said while speaking on Fox Business this morning.
Duffy insisted that the mission of NASA is to pursue exploration, not to support research focused on “all of these earth sciences.”
Some history: NASA has engaged in formal climate research for decades, stretching as far back as the 1970s and 1980s. By 2007, the agency had roughly 17 space missions that were collecting climate-related data, such as levels of ozone, changing sea levels, and measuring aerosols in the atmosphere.
NASA’s climate-related research has expanded in the last 15 years, supporting satellites and technologies focused on measuring where greenhouse gases are emitted and absorbed. It was revealed earlier this month that the Trump administration would be cutting funding for these missions, part of the Orbiting Carbon Observatories, as part of its latest effort to stymie federal research on climate change.
COUNTRIES REACH FINAL HOURS FOR PLASTIC TREATY: For the past several days, world leaders have been meeting in Geneva in hopes of signing a treaty to address plastic pollution.
However, as they enter the final hours of negotiations, an agreement appears to be further away. Negotiators have been in Geneva for 10 days as the second part of the fifth session of the United Nations’ Intergovernmental Negotiating Committee to develop an international treaty on plastic pollution.
A draft agreement was released yesterday, with some leaders expressing strong opposition to the lack of ambition within the treaty. The Associated Press reports that the draft failed to impose a limitation on producing plastic products and does not address chemicals used in plastic products. It also did not ask countries to agree to legally binding rules.
French President Emmanuel Macron tweeted: “This global plastic pollution treaty is our chance to turn the tide. But the weak ambition in the draft presented yesterday at the United Nations is simply unacceptable.”
“I urge all states gathered in Geneva to adopt an agreement that truly meets the scale of this environmental and public health emergency,” he added.
The Associated Press said a new draft is expected later today.
LATEST ON WILDFIRES IN SPAIN: The European Union is providing support to firefighters fighting the wildfires in Spain.
Spain for the first time activated the EU Civil Protection Mechanism to combat wildfires. The mechanism helps strengthen civil protection between EU countries dealing with a disaster.
BBC reports that Spanish Interior Minister Fernando Grande-Marlaska requested two water bomber aircraft from the EU to be deployed to the worst-affected areas. As of this morning, three people have died due to the wildfires.
A heatwave hitting parts of Europe, specifically Spain, is expected to last until Monday. There are 14 wildfires burning across seven regions in Spain. There are numerous wildfires burning across southern Europe. Greece, Bulgaria, Montenegro, and Albania have also activated the EU’s civil protection mechanism.
ICYMI – TRUMP NAMES DEMOCRAT TO LEAD FERC: Trump has named David Rosner as chairman of the Federal Energy Regulatory Commission, a seat the Democrat is only expected to hold in the short term.
The details: Rosner has served on the commission since June 2024, having been nominated to the independent agency by then-President Joe Biden. The pick comes as a surprise to many, as Biden had also nominated Republican-leaning Lindsay See to the commission around the same time.
Before joining FERC, Rosner served as an aide to former Sen. Joe Manchin, and was a senior policy adviser for the Energy Department’s Office of Energy Policy and Systems Analysis.
Axios reported that Rosner would be tapped as chairman last week, with a White House official telling the outlet that the commissioner “has committed to executing President Trump’s America First energy policy agenda.” The administration pointed to the commissioner’s record of supporting the accelerated build-out of data centers and energy generation to advance AI.
Some reaction: Rosner’s appointment is expected to be temporary, even though he is widely considered a natural gas supporter and more of a centrist Democrat. Trump has nominated two additional Republican commissioners to FERC: Laura Swett and David LaCerte, either of whom could be designated as chair once confirmed by the Senate.
While industry groups like Advanced Energy United and the Interstate Natural Gas Association of America celebrated Rosner’s appointment, it has been criticized by environmentalists and climate activists.
“Rosner has promoted the gas and the fossil fuel industry for years and is far too biased to hold this position,” Raena Garcia, Senior Climate Campaigner at Friends of the Earth, said in a statement. “Democrats who care about the climate should reject him out of hand.”
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