WHAT’S HAPPENING TODAY: Good afternoon and happy Monday, readers! We hope you all had a great weekend. Callie and Maydeen are kicking off today’s Daily on Energy with comments from Energy Secretary Chris Wright, who remains confident that the U.S. will be able to increase oil production while lowering prices for Americans.
We also take a look at a letter from over 20 House Republicans outlining the importance of energy tax credits from the Inflation Reduction Act.
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As always, see what energy and climate-related events are happening this week at the end of the newsletter.
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.
WRIGHT CONFIDENT U.S. CAN ‘DRILL, BABY, DRILL’ WITH LOW OIL PRICES: While the market has thrown cold water on the idea of the U.S. increasing crude production amid dropping oil prices, Energy Secretary Chris Wright remains confident the administration can deliver the president’s campaign promise.
The details: Wright told the Financial Times this week that the U.S. would “absolutely” secure low prices for Americans and increased oil production – which has already hit record highs in recent months. The energy secretary and oil veteran pointed to past price and production disruptions within the industry in 2014, which ultimately resulted in lower prices of oil.
“We are going to see those same kind of market dynamics now,” Wright told the outlet. “New supply is going to drive prices down. Companies are going to innovate, drive their prices down and consumers and suppliers will bounce back and forth.”
State of play: The cost of oil has been on a steady decline for weeks, with international and domestic benchmarks sitting below $70 a barrel. At around 12 p.m., Brent Crude was priced at $69.92 a barrel, while West Texas Intermediate sat at roughly $66.71 per barrel. Analysts have predicted that, with the planned output hike from OPEC+ scheduled for next month, and the Trump administration’s agenda, prices could continue to drop to $50 a barrel or below.
Given this, industry executives have suggested that oil and gas producers within the U.S. are hesitant to increase spending to boost output. Lorenzo Simonelli, the CEO of Baker Hughes, told Reuters at CERAWeek today that the drilling operator does not plan to restructure or reduce its workforce but will see improved efficiencies to support more production. Still, he warned the industry is already limited in what they can do as there has been more consolidation over the past few years. “There’s a dislocation between the rig count and production, just driven by the efficiencies of more modern rigs, as well as then the production efficiencies,” Simonelli said.
OVER 20 REPUBLICANS ASK PARTY TO KEEP CLEAN ENERGY TAX BREAKS: It is growing increasingly difficult for Republicans to cut subsidies from the Democratic-passed Inflation Reduction Act, as more on the right side of the aisle are calling on their colleagues to keep the clean energy tax credits created by the landmark climate law.
The details: In a letter sent to Ways & Means Committee Chairman Jason Smith on Sunday, 21 House Republicans emphasized the importance of “prioritizing energy affordability” amid efforts to cut sweeping clean energy tax credits in the party’s budget resolution.
The letter, reported on by Politico, indicated that the Republicans would be willing to oppose the party’s efforts to reform the tax code through reconciliation, a legislative process that allows for bills to bypass the filibuster and pass with only a simple majority in the Senate.
The lawmakers insisted that they support the Trump administration’s America First energy agenda, noting that clean energy advancements have a key part to play. The Republicans said that, as the energy tax credits have been used by “countless of American companies”, particularly among their constituents, there are growing concerns about “disruptive changes” to the tax code.
They did note that there are “plenty of shortcomings” when it comes to existing energy tax breaks, yet urged party leaders to approach any repeals in a “targeted and pragmatic fashion” that would avoid undoing current and future industry investments.
The Republican position: While Republicans hold the majority in the House and Senate, it has become increasingly clear in recent months that the party faces many hurdles in walking back a majority of the clean energy and climate-related tax incentives approved under the IRA, as the credits have benefited constituents in Republican-led districts. In the fall, Speaker Mike Johnson suggested that the party would approach IRA repeals with a “scalpel” rather than a sledgehammer. Last month, he appeared more confident in the repeals, saying “It’ll be somewhere between a scalpel and a sledgehammer.”
JET FUEL LEAKING IN NORTH SEA AFTER TANKER COLLISION: A U.S.-flagged oil tanker went up in flames and started leaking jet fuel into the North Sea off the coast of England this morning after being struck by a container ship, forcing the crews of both vessels to abandon ship.
The details: The Stena Immaculate tanker, managed by Florida-based Crowley Maritime, was struck by the Portuguese-flagged Solong off the coast of Hull where it was anchored at around 10 a.m. UTC, causing a fire on both vessels. Tall flames and billowing black smoke could be seen stretching far above the ships, in images of the collision shared to social media.
Crowley Maritime confirmed that the Stena Immaculate had been carrying a cargo tank containing Jet-A1 fuel, which ruptured as a result of the collision. The company also confirmed that jet fuel has since been leaking into the sea below. A spokesperson for Crowley Maritime confirmed to The Telegraph that the ship was working under a U.S. military contract at the time of the collision, and was a part of the U.S. Government Tanker Security Program.
The impact: Graham Stuart, a member of the British parliament representing a nearby region, warned in a video statement that the collision could have a “devastating environmental impact.” It remains unclear how much fuel or oil was released into the water, as the sea itself and current weather conditions will also impact the severity of the situation.
The National Oceanic and Atmospheric Administration estimates that, unlike diesel fuel, jet fuels can have a less toxic effect on the environment, particularly in open water. The agency does warn that any aquatic organisms that come in direct contact with the fuel may be killed. But small leaks in open water may not necessarily result in mass killings of fish. Environmental impacts are expected to be greater in areas with small streams and dense vegetation.
Read more from Callie and the Examiner’s Jack Birle here.
SUPREME COURT REJECTS TO HEAR STATE LAWSUIT AGAINST OIL COMPANIES: The U.S. Supreme Court declined to hear a case filed by Republican state attorneys general to block Democratic-led states from suing major oil companies, Reuters reports.
Democratic-led states have sued major oil companies, including Exxon Mobil, Chevron, ConocoPhillips, Shell, and BP, alleging they have deceived the public about the contributions of fossil fuels to climate change. The states are seeking monetary damages due to the effects of climate change, such as wildfires and rising sea levels.
However, the Republican-led states argued that the Democrats are unlawfully trying to regulate global emissions, which only the federal government can regulate. The Republicans’ complaint was led by Alabama Attorney General Steve Marshall.
Justices Clarence Thomas and Samuel Alito said they would allow the lawsuit to proceed.
CANADA SLAPS 25% TARIFF ON ELECTRICITY FOR OVER ONE MILLION US CUSTOMERS: The government Ontario is now implementing a 25% surcharge on electricity exported from the province into the U.S., impacting around 1.5 million customers along the border.
The details: Ontario Premier Doug Ford announced that the tariffs went into effect this morning, saying during a news conference that he did not want to implement the retaliatory fee. “I feel terrible for the American people, because it’s not the American people who started this trade war. It’s one person who’s responsible, that’s President Trump,” Ford said, according to CBC News.
The tariffs are expected to affect customers living in New York, Michigan, and Minnesota, raising their electricity bills by around $100 more per month. Ford added that the tariff would remain in place until the Trump administration completely walks back its 25% border tariff on Canadian and Mexican goods. President Donald Trump again temporarily delayed the tariffs last week until April 2.
Today, Ford also reiterated his threat to completely cut off energy exports to the U.S. if the tariffs escalate. “If necessary, if the United States escalates, I will not hesitate to cut the electricity off completely,” he told reporters. “Let’s just see how this rolls out. [Trump] changes his mind almost every single day.”
CLIMATE GROUPS SUE EPA OVER FROZEN FUNDS: Climate United, a nonprofit organization, sued the Environmental Protection Agency and Citibank for pausing the distribution of the Biden administration’s Greenhouse Gas Reduction Fund meant to build out clean energy projects in low-income communities.
Climate United claims that the EPA has illegally prevented Citibank from disbursing the program’s funds to the organization, which they said harms their borrowers and the communities they serve. The $20 billion Greenhouse Gas Reduction Fund program was established through the Inflation Reduction Act, with nearly $7 billion of those funds being awarded to Climate United.
Climate United is one of eight nonprofits that have received funding from the program.
But EPA Administrator Lee Zeldin has claimed that the program improperly distributed its funds, resulting in possible fraud. The EPA has frozen the funds. The Washington Post reported last month that the FBI began questioning employees from the EPA regarding the program.
The Trump administration’s appointees previously requested the U.S. attorney’s office in D.C. to investigate the funding program. But the head of the criminal division, Denise Cheung, reportedly refused to open a grand jury investigation into the climate funding program because it lacked sufficient evidence. Cheung later resigned.
DOE APPROVES PERMITTING EXTENSION FOR LNG EXPORTER: Wright announced a permit extension for Delfin’s liquefied natural gas exporter project off the coast of the Louisiana.
In his opening remarks at CERAWeek in Houston, Wright said the Trump administration is embracing all forms of energy that are “affordable, reliable, and secure.”
Delfin is building a floating vessel that would produce 13.3 million metric tonnes of LNG per annum in Louisiana. Reuters reports that the company has been seeking a five-year extension to export to countries that do not have a free trade agreement with the U.S.
The export permit extension marks the fourth LNG approval by the Trump administration, which has been seeking to boost the oil and fossil fuel industry. Last week, the DOE approved an export extension for Texas-based Golden Pass LNG, allowing the company to complete construction of its LNG export terminal three years after the original deadline.
WIND WORKERS CONSIDER LEAVING INDUSTRY AMID TRUMP’S SCORN: As Trump has targeted his ire on the offshore and onshore wind industry since taking office, many workers in the business are considering leaving their jobs.
The details: Multiple employees, who spoke on the condition of anonymity, recently told CNN that pressure from the White House may be pushing them out. “I just don’t understand how wind can be targeted. We need more energy sources,” one employee who works with a wind developer told the outlet. A separate executive who works in wind energy told CNN, “The prospects look dim. You want to hang on and have hope, but the glimmers of hope are fading.”
On his first day in office, Trump signed an executive order blocking all lease sales for offshore wind projects and pausing any new approvals, permits, leases, or loans for wind projects both on and offshore. While Interior Secretary Doug Burgum has indicated some offshore wind projects that are already under construction or permitted may not face as much scrutiny, the impact of the administration’s agenda is already being felt. Several large projects have been canceled or delayed leaving hundreds without jobs. Climate Power has reportedly estimated that since Trump was elected, the industry has cut around 300 jobs, while 10,000 have been delayed.
DEI EFFORTS ACTIVELY IMPLEMENTED AT THE EPA: The Biden administration’s Environmental Protection Agency actively worked to implement diversity, equity, and inclusion policies, including de-gendering restrooms at agency headquarters, the Free Beacon reports.
The Free Beacon obtained agency documents and communications that showed the EPA in 2021 created an employee-led “DEIA implementation team” to create working groups and DEI-related actions. The Free Beacon said the agency’s DEI initiatives were coordinated with its LGBTQIA+ Workgroup that included various EPA employees, such as scientists, attorney advisers, and researchers.
In September 2023, the agency’s LGBTQIA+ Workgroup recommended at a conference that the agency to “de-gender” restrooms and locker room access, according to slides reviewed by the Free Beacon. The workgroup also made recommendations including incorporating LGBTQIA+ prospective employees into recruiting activities, adding gender pronouns on email signatures, and many others.
The EPA has removed DEI initiatives since Trump took office. In his first day of office, Trump signed an executive order undoing DEI initiatives and offices at federal agencies.
A LOOK AHEAD:
March 10 – 14 CERAWeek hosted by S&P Global will take place in Houston, Texas
March 11 – 13 The Nuclear Regulatory Commission is hosting its 37th Regulatory Information Conference, featuring guest remarks from Senate Committee on Environment and Public Works Chairwoman Shelley Moore Capito.
March 11 The House Energy and Commerce subcommittee on Environment is holding a hearing titled “Maximizing Opportunities for Redeveloping Brownfields Sites: Assessing the Potential for New American Innovation.”
March 11 The Center for Strategic and International Studies is holding a webinar titled “The Thirst for Power: Overcoming the Politics of Water in the Middle East.”
March 12 The Business Council for Sustainable Energy is holding a clean energy industries reception in Washington D.C.
March 12 The Center for Strategic & International Studies hosts Deepening U.S.-Japan Clean Energy Cooperation
March 13 The Business Council for Sustainable Energy is holding a tax summit with Bracewell LLP, where discussions will dive into the major energy and non-energy tax issues at play in Congress.
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