WHAT’S HAPPENING TODAY: Good afternoon and happy Friday, readers! We’ve made it to the weekend after another busy week in D.C. If you’re looking for something to do this weekend, Theater Week is officially underway, with dozens of shows across the DMV offering discounted tickets. Check it out here.
In today’s newsletter, we take a look at Europe’s plea to President Donald Trump to forgo a ban on diesel exports, as the administration looks to curb high fuel prices ahead of the midterms.
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.
QUOTE OF THE WEEK:
Senate Republicans are upping pressure on their Democratic colleagues to vote on a permitting reform bill before the chamber breaks next week, insisting that a delay to after the midterm elections will all but kill the legislation.
“Like so many other things, this project to diminish the delays is itself likely going to die on the vine because of this delay they’re insisting on,” Energy and Natural Resources Committee Chairman Sen. Mike Lee said last night of Democrats, who are punting a permitting vote to get more of their caucus on board.
“If we wait until after the election, it is almost certainly not going to happen,” Lee warned. “Not now, not this year, probably not for several years to come.”
EUROPE FACES A NEW FUEL THREAT FROM THE U.S.:
As the Trump administration weighs restrictions on diesel exports, Europe is lobbying against any such action, as it would disrupt fuel supply and drive up costs.
The European Union energy commissioner, Dan Jorgensen, asked President Donald Trump to maintain a “free flow” of diesel, especially as winter approaches.
Jorgensen told the Financial Times that it is in the U.S.’s and Europe’s interests to “have as free flow of energy between our countries as possible.”
He added that, even without a ban on U.S. diesel, Europe’s winter could be “very, very bad” for energy prices, even worse than in 2022.
Since the war in Iran, Europe has faced challenges filling its natural gas storage ahead of this year’s winter. At the same time, Russia has also restricted its diesel exports.
A U.S. diesel ban would further tighten Europe’s already constrained fuel supply.
“For Europe, the immediate effect is higher prices. North-West Europe would have to bid up to pull in replacement cargoes, and it would be bidding against the Mediterranean, Latin America and West Africa for the same limited pool of barrels,” Zameer Yusof, an energy analyst at market intelligence platform Kpler, told Euronews.
Since Russia has restricted its diesel exports, Europe has been more reliant on the U.S. supply. In August, Europe imported nearly 506,000 barrels a day of U.S. diesel.
Prices in Europe have also risen in response to the president’s consideration of a ban.
It was reported earlier this week that diesel prices at the pump across the European Union reached a new high of 2.23 euros per litre, which is up from 2.16 euros the previous week.
The administration has been weighing its options for a ban on exports. It was reported earlier this week that the White House is considering a 90-day ban on diesel exports in an effort to curb fuel prices ahead of the midterms.
The European Commission yesterday warned that a 90-day ban on diesel exports “would risk negatively impacting both sides.”
However, the administration is divided over whether a ban is the right option.
Energy Secretary Chris Wright has argued that a ban would further push prices even higher. He has also said that the administration would consider partial restrictions or a voluntary approach.
Any restriction on diesel exports would be felt not only in Europe but by other major buyers, including Brazil, Chile, Mexico, Peru, and Morocco. The U.S. exported nearly 1.6 million barrels per day of diesel in August, up from about 1 million bpd before the war in Iran began.
The American Petroleum Institute warned earlier this week that a diesel ban would “wreak havoc on fuel markets at home and abroad, destabilize refinery operations and deepen a global refining crisis already putting upward pressure on U.S. prices.”
Politico reported that the White House is weighing alternative options to imposing a diesel export ban. One of the options the administration is considering is encouraging states to eliminate excise taxes on diesel. Sources told Politico that a policy decision could happen as soon as today or early next week.
All the rest:
NOR’EASTER TO HIT THE EAST COAST: A nor’easter storm is set to hit the East Coast this weekend, bringing heavy rain, coastal flooding, and strong winds.
The storm has already prompted coastal flooding alerts for those along the East Coast, affecting states from Virginia to Rhode Island.
North Carolina’s Outer Banks have already recorded waves up to 19 feet, with flooding already occurring in the area. ABC News said waves up to 12 feet are possible for the Outer Banks to New Jersey shore through Saturday and along the New England coast through Sunday.
The storm is expected to peak on Saturday, bringing heavy rain and strong winds from New Jersey to Massachusetts throughout the day.
The Jersey Shore, Rhode Island, and Massachusetts coasts are under a high wind warning from today to Sunday. New York City can also see wind gusts from 40 to 50 mph from today to Sunday.
The storm will begin to weaken on Sunday, but expect rain from Washington, D.C., to Maine.
“This will be a long-duration event through multiple tide cycles well into this weekend, leading to major coastal flooding and beach erosion as well as strong winds pushing on trees for a longer period of time,” AccuWeather Chief Meteorologist Jon Porter said.
“Expect not only coastal inundation from storm surge, but also areas of urban flooding away from the coast, as well as regional power outages,” Porter added.
REFINER TO USE ARTIFICIAL INTELLIGENCE IN OPERATIONS: Phillips 66 announced today that it is using artificial intelligence in its refining operations, to help predict outages and save maintenance costs, according to Reuters.
“I need my systems up more than they’re down, being able to predict that obviously saves on maintenance costs,’ executive vice president Tandra Perkins said.
Perkins said the use of AI will allow the refiner to increase its processing of crude oil.
THE LATEST ON OIL: Oil prices fell today on reports that Iran has offered to reopen the Strait of Hormuz within the next week.
A reopening of the strait, even if just temporary, would send a major shock of confidence through the market that normal flows can resume in the near future. Earlier in the week, recorded traffic through the waterway fell again to single digits.
Just after 12 p.m. EDT today, international benchmark Brent crude dropped by 2.89% and was selling at $103.52 a barrel. West Texas Intermediate had also fallen 3.04% and was priced at $91.88 a barrel.
RIG COUNT UPDATE: The number of U.S. oil and gas rigs was up four on the week, according to Baker Hughes.
On the year, the rig count is up 50.
TRUMP’S ENERGY TEAM GETS RARE PRAISE FROM BIDEN ADMINISTRATION: When it comes to upgrading the U.S. electricity grid, almost everyone in Washington can agree it’s a bipartisan issue.
As we touched on yesterday, the Department of Energy announced it was spending $1.9 billion on 31 projects to upgrade transmission and grid infrastructure in order to add more capacity to the grid. The funding, which is a part of a total $5 billion investment, received praise not only from trade groups but Democrats who worked under the Biden administration.
“Credit where credit is due,” Jennifer Granholm, who worked as the Secretary of Energy under former President Joe Biden, wrote on LinkedIn.
Granholm pointed out that the funds originated from the Bipartisan Infrastructure Law signed by Biden in 2021. And while the Trump administration has made efforts to claw back millions of dollars of funding approved under Biden, the Department of Energy kept the grid funding intact.
The agency, Granholm said, “put the money to work rather than walking away from it. That’s worth applauding…Different administrations can call programs different things. What matters is getting stuff built — and getting more out of the grid we’ve already got. Well done, DOE.”
TAIWAN TAKES ANOTHER LOOK AT NUCLEAR: Taiwan could be powered by nuclear energy once again, as the country has approved a preliminary plan to restart a shuttered nuclear power plant.
The island shut down its final nuclear reactor in May of last year, fully phasing out the use of the carbon-free technology.
Under the new plan, at least one facility could reopen in just two years, according to Bloomberg.
Earlier today, Taiwan’s Nuclear Safety Commission finished a review of a proposal to reopen the Maanshan Nuclear Power Plant. The facility closed last year after its 40-year operating license expired.
ICYMI – EX-IM BANK TO FINANCE $7 BILLION IN ARGENTINA’S ENERGY SECTOR: The Export-Import Bank announced earlier this week it would provide Argentina with up to $7 billion through 2027 for its energy sector and critical mineral development. Argentina has critical minerals like lithium, copper, nickel, cobalt, and other rare earths.
RUNDOWN
The Associated Press Europe uses subsidies, taxes and policy pauses to offset pain of high fuel prices
Politico Republicans say they want to address data centers. Democrats smell a campaign-season rat.
Inside Climate News Indian Point Energy Center’s Uncertain Future
CNN Trump wants to take a page out of the Biden energy playbook
Continue reading...
[ H/T Washington Examiner ]
