Reuters
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You know what was so hot? 2020. In fact, it tied with 2016 as the hottest year on record, according to NASA. Sigh.
That was big news this week, as was a mass-retreat from corporate political donations, following the attack on The Capitol incited by President Donald Trump.
ConocoPhillips and BP said they’re suspending PAC donations for the first half of the year, The Washington Post reported. Marathon Petroleum, the largest US refiner, and Occidental Petroleum will also temporarily ban contributions. Exxon and Chevron didn’t go so far and said their PACs are under review.
Of course, that doesn’t mean the industry is aligning with President-elect Joe Biden’s priorities …
David McNew/Getty Images
Big Oil promises to put up a fight if Biden tries to restrict fossil-fuel development
This week, the head of the American Petroleum Institute – the most powerful oil and gas trade group – said his industry is prepared to fight policies Biden has proposed that could restrict fossil-fuel producers, per Inside Climate News. Those include:
- A ban on new leasing or permitting for oil and gas projects on federal lands.
- The elimination of tax credits that support the fossil-fuel sector.
- Funding for electric vehicles and charging infrastructure.
His words: “The surest way to bring recovery to a stop is to remove affordable energy from the picture – with more regulations, more taxes, more restrictions on access,” API president and CEO Mike Sommers said at the group’s State of American Energy event Wednesday. “If lawmakers curtail resource development and energy prices spike, it’s working people and consumers who will suffer.”
- Biden has proposed a plan to build out clean-energy infrastructure that he said will create jobs and help curb climate change.
- It’s worth noting that renewable energy is increasingly the cheapest source of new power.
But remember: Biden doesn’t have much latitude to enact restrictive policies anyway, even though Democrats will control the Senate. We explain what he can and can’t do here.
- Plus, oil and gas firms thought ahead and have been stockpiling drilling permits on federal lands, AP reports, so any kind of ban on federal lands would be largely symbolic.
- “The permit stockpiling has centered on oil-rich federal lands in New Mexico and Wyoming,” per AP.
In other news: Total withdrew from the API Friday, after what it called a “detailed analysis” of the group’s climate positions. It’s the first major oil company to do so.
The Biden-Harris Transition
Meanwhile, Biden just beefed up his climate team
Joe Biden’s climate and energy team continues to grow, with more announcements this week.
At the White House office of domestic climate policy …
- Sonia Aggarwal was selected as senior advisor for climate policy and innovation. She’s a cofounder of the think tank Energy Innovation and served as VP there prior to her appointment.
- David Hayes will be the special assistant to the president for climate policy. Hayes is an adjunct professor at the NYU School of Law, and was deputy secretary of the Interior Department under former presidents Barack Obama and Bill Clinton.
- Maggie Thomas was appointed as chief of staff. She serves on Biden’s transition team and previously served as climate policy advisor to Senator Elizabeth Warren and deputy climate director to Governor Jay Inslee of Washington state.
- Finally, Jahi Wise will be senior advisor for climate policy and finance. He previously served as the policy director for the Coalition for Green Capital, a nonprofit that aims to drive investment towards clean energy.
At the Environmental Protection Agency …
- Janet McCabe will fill the big role of deputy administrator. McCabe is a professor of environmental law at Indiana University McKinney School of Law and leads IU’s Environmental Resilience Institute. She’s also an EPA alum.
At the Council on Environmental Quality …
- Cecilia Martinez, Ph.D. will be the senior director for environmental justice. Martinez serves on Biden’s transition team and is cofounder and executive director at the Center for Earth, Energy, and Democracy.
At the Presidential Personnel Office …
- Jeff Marootian was tapped to be special assistant to the president for climate and science agency personnel. An Obama administration alum, Marootian is director of DC’s Department of Transportation and serves on Biden’s transition team.
Joe Raedle/Getty Images
2020 by the numbers
Results are in. 2020 was a bad year (with a few things for climate-tech folks to celebrate.)
1.84: How much warmer 2020 was, on average, compared to the baseline temperature in 1951-1980, in Fahrenheit, according to NASA. 2020 tied with 2016 for the warmest year on record, the agency said.
10.3: Estimated percent decline in US greenhouse gas emissions last year, which amounts to “the single largest drop in annual emissions in the post-World War II era,” according to Rhodium Group. The pandemic is largely responsible for the dip.
112: The number of oil companies that filed for bankruptcy protection, including producers, oilfield service firms, and midstream companies, according to Haynes and Boone.
237: The number of companies that went public via SPAC, more than four times as many as in 2019, per Clean Edge. Two dozen or so were cleantech firms, the firm said. 15 were EV-related, according to Raymond James.
429,300: The number of clean-energy workers who lost their jobs, according to an analysis by BW Research Partnership. The oil industry is expected to report similarly high numbers.
$16.4 billion: Venture capital poured into climate technologies, a record, according to PitchBook data published by Axios.
Markets Insider
Major Wall Street banks revised their oil forecasts as prices soar
JPMorgan is among the major banks to revise their outlook for oil prices, which were hammered as the pandemic dried up demand for gasoline and jet fuel. On Wednesday the bank moved forward its price forecast by six months.
What to expect: JPMorgan now thinks Brent crude, the international benchmark, will breach $60 a barrel in the second quarter and average as high as $68 – about where it was at the start of last year – towards the end of 2021.
- Bank of America said something similar this week: “A trend following rally to $67 can’t be ruled out.”
Industry impact: It’s good, obviously – and it’s one reason why Wall Street appears to be warming back up to Exxon.
- “JPMorgan Chase & Co. on Wednesday joined Morgan Stanley, Goldman Sachs Group Inc. and Well Fargo & Co. in upgrading Exxon to ‘buy’ in recent weeks,” reports Bloomberg’s Kevin Crowley.
- Still, US producers are unlikely to ramp up production much because they’re under pressure to reign in spending, JPMorgan analysts said.
In other Exxon news: The SEC has launched an investigation into Exxon after an employee filed a whistleblower complaint that the company overvalued an important asset in the Permian Basin, the top US shale field, the Wall Street Journal reported.
3 other big stories this week
- Oil major Equinor won a contract to supply offshore wind energy to New York state. It’s the largest renewable energy deal for a US state.
- Electric-bus maker Proterra announced it’s going public via SPAC.
- Chevron made an investment in Blue Planet, a startup focused on carbon capture and utilization.
That’s it! Have a great MLK-day weekend.
– Benji
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