Latest market news

US climate policy is lacking: Government report

  • Market: Biofuels, Coal, Crude oil, Electricity, Emissions, Hydrogen, Metals, Natural gas, Oil products, Petrochemicals
  • 14/11/23

Every region of the US is already feeling the effects of climate change but policymakers are still not doing enough to reduce greenhouse gas (GHG) emissions, according to a new report from US government scientists.

The fifth National Climate Assessment, a congressionally mandated report released around every five years, is the product of 14 federal agencies and hundreds of authors. It offers largely similar conclusions as prior iterations, namely that fossil fuel use is the primary driver of global warming, though the authors note that recent scientific advances allow for more certainty around future projections.

"This assessment shows us in clear scientific terms that climate change is impacting all regions, all sectors of the United States," US president Joe Biden said today. "Not just some, all."

The US now experiences a $1bn weather disaster about every three weeks, compared with once every four months during the 1980s, and is set to warm more on average than the rest of the world as global temperatures continue rising, the report says.

Regional impacts vary. Heightened drought risks in the western US endanger hydropower generation for instance, while sea level rise is projected to be greatest along the US Gulf Coast, threatening much of the country's crude oil production and refining capacity.

US GHG emissions fell by 12pc from 2005-2019, largely because of declining coal-fired generation, but meeting the country's Paris climate agreement commitments and achieving net-zero emissions by 2050 will require emissions to decline by more than 6pc/yr on average. Recent policies like the federal Inflation Reduction Act's clean energy tax credits and new state-level mitigation efforts have helped, but much more action is needed, according to the report.

Existing policies "remain woefully insufficient and incremental," said Kristina Dahl, a report contributor and principal climate scientist at the Union of Concerned Scientists.

Some solutions are already cost-effective, such as building more wind and solar capacity and electrifying more vehicles and heating systems. Less proven technologies like carbon capture may help, according to the report, which also expresses cautious optimism about the voluntary carbon offset market's potential role helping companies meet their climate targets.

The country's exact path to net-zero is still hazy, however, given uncertainty around the role of natural gas-fired generation in a renewables-dominant grid and the extent to which biofuels and hydrogen will help decarbonize sectors that are difficult to electrify. The report notes that most available modeling of a net-zero US involves "substantial" reliance on carbon removals, although it is unclear what strategies, which range from reforestation to industrial direct air capture, will be available at scale.

Though the researchers make clear that the risks of climate change are far greater, the energy transition creates its own risks too. The report notes the high likelihood of rising power demand as more sectors electrify, requiring more investments in energy infrastructure, and the threat of "near-term shortages" of metals and minerals crucial for zero-carbon technologies.


Sharelinkedin-sharetwitter-sharefacebook-shareemail-share

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News
03/01/25

US 45V update opens door to more H2 from natural gas

US 45V update opens door to more H2 from natural gas

Houston, 3 January (Argus) — The US Treasury Department's updated requirements for hydrogen production tax credits amends the way upstream emissions are calculated, potentially making it easier for natural gas producers to qualify for the lucrative subsidy. Previous guidelines used fixed assumptions about the rate of methane leaked from wells and pipelines rather than accepting data from individual projects. The industry argued that using uniform figures under the existing GREET model to calculate emissions would unfairly penalize companies that had taken steps to reduce methane leakage. In final rules released Friday , the Treasury Department creates a pathway for companies to submit project-specific emissions data, an amendment that had been advocated for by ExxonMobil and the American Petroleum Institute, among others. Without this change, some companies considering ammonia export projects along the US Gulf Coast said they would instead consider applying for 45Q tax credits for carbon sequestration, which cannot be used in conjunction with 45V. Previous guidance only provided a pathway for renewable natural gas (RNG) produced from landfills to qualify for lucrative tax credits. The new rules include wastewater treatment, animal manure and coal mine methane. By Jasmina Kelemen Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Find out more
News

US crude output at record 13.46mn b/d in Oct: EIA


03/01/25
News
03/01/25

US crude output at record 13.46mn b/d in Oct: EIA

Calgary, 3 January (Argus) — US crude production rose to a record 13.46mn b/d in October on sustained strength in Texas and New Mexico, according to the EIA's latest Petroleum Supply Monthly report. Output rose from 13.2mn b/d in September and 13.15mn b/d in October 2023, and pushed past the previous record of 13.36mn b/d set in August. Texas pumped a record 5.86mn b/d, up from 5.8mn b/d in September and 5.57mn b/d a year earlier, while New Mexico produced 2.08mn b/d, down slightly from record highs in August and September, but up from 1.8mn b/d in October 2023. Gulf of Mexico output rebounded to 1.85mn b/d from a hurricane-affected 1.57mn b/d in September, but was down from 1.94mn b/d a year earlier. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

Nippon Steel condemns Biden move to block US Steel bid


03/01/25
News
03/01/25

Nippon Steel condemns Biden move to block US Steel bid

Tokyo, 4 January (Argus) — Japanese firm Nippon Steel has condemned President Joe Biden's decision to block its proposed $15bn acquisition of US Steel citing national security concerns arising from a Japanese company owning a major US steelmaker. The US president has "sacrificed the future of American steelworkers for his own political agenda", Nippon Steel said. "It is clear that the CFIUS (committee on foreign investment in the United States) process was deeply corrupted by politics and the outcome was pre-determined to satisfy the political objectives of the Biden administration," Nippon Steel added. The company pledged to save the deal by "taking all appropriate action to protect our legal rights". Nippon Steel warned that Biden's decision sends a chilling message to any company based in a US-allied country contemplating significant investment in the US. "It is shocking and deeply troubling that the US government would reject a pro-competitive transaction that advances US interests and treat an ally like Japan in this way," the company said. Biden's decision is hard to understand and regrettable, especially given that it was made after consideration of US national security, Japan's trade and industry minister, Yoji Muto, said. Tokyo will seek to clarify with the Biden administration the decision-making process followed by the CFIUS, Muto added. Japan's trade and industry ministry (Meti) agrees with Nippon Steel that the transaction would contribute to sustaining steel production capacity and employment in the US economy, Muto said, adding that the acquisition would be of mutual benefit. "The deal is to promote collaboration on advanced technologies and increase the competitiveness of the US and the Japanese steel industry," he added. The Japanese government must take this matter seriously, Muto reiterated, given growing concern among Japanese industries regarding the future US-Japan investment climate. Japanese business federation Keidanren in September wrote an open letter to US treasury secretary Janet Yellen, who chairs the CFIUS, expressing concern about political pressure being brought to bear on the committee. By Yusuke Maekawa Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

Eni ready for FID on Mozambique’s Coral Norte FLNG


03/01/25
News
03/01/25

Eni ready for FID on Mozambique’s Coral Norte FLNG

London, 3 January (Argus) — Italian energy firm Eni is ready to take a final investment decision (FID) on its planned 3.4mn t/yr Coral Norte floating liquefaction (FLNG) terminal in Mozambique, should the project receive authorisation from the country's government, the firm has told Argus . Eni said it expects the government's approval to be "imminent", although it did not provide a more detailed timeline. The firm said in June 2023 that it planned to start operations at the FLNG in the second half of 2027. Eni already operates Mozambique's 3.4mn t/yr Coral Sul FLNG, which started operations in late 2022 and is at present the country's only LNG terminal. Coral Norte is set to be installed 20km north of Coral Sul. There are also two onshore terminals planned for Mozambique — the TotalEnergies-led 13.1mn t/yr Mozambique LNG project and ExxonMobil's 18mn t/yr Rovuma LNG project. Both are located in the Cabo Delgado province and have been halted because of security concerns. TotalEnergies reached a financial close on their Mozambique project in 2019 and declared force majeure in 2021, though project partner Bharat Petroleum (BPCL) said in late October 2024 the force majeure could be lifted in January or February this year because of an improvement in the security situation. And ExxonMobil said in November last year it was planning to take FID on the Rovuma project at the start of 2026. By Cerys Edwards Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

US relaxes rules for H2 production tax credits: Update


03/01/25
News
03/01/25

US relaxes rules for H2 production tax credits: Update

Adds information on state-specific additionality rules in paragraphs 6-8. Houston, 3 January (Argus) — The US Treasury Department has issued long-awaited tweaks to 45V hydrogen production tax credit (PTC) guidelines, relaxing rules in a bid to make it easier for producers to benefit from the subsidy. The final guidance released today retains the fundamental approach from the preliminary rules set out in December for the tax credits of up to $3/kg. The "three pillars" of additionality, temporal matching and regional deliverability remain in place for electrolytic hydrogen, but the Treasury has tweaked certain aspects. The additionality rule prescribes that hydrogen production facilities can only use electricity from clean power generation capacity that predated them by 36 months or less to encourage a further build-out of such capacity. But under the final rules, hydrogen made with power from existing nuclear plants can qualify for the credits under certain circumstances. Hydrogen producers can access the credits if nuclear power companies demonstrate that adding hydrogen production to their revenue stream extends the life of reactors otherwise slated for shutdown. Companies such as utility Constellation Energy have argued that using some of their nuclear capacity for hydrogen would provide a pathway for future relicensing of their reactors , but that this would hinge on access to the tax credits. The final guidelines now also consider existing fossil fuel-based power plants where carbon capture capabilities have been retrofitted within the 36-month window prior to starting up hydrogen production as additional capacity. This makes hydrogen output using electricity from these plants eligible for the tax credits. The guidelines also introduce a rule under which hydrogen production in certain states is eligible for the tax credit even if it is based on clean power generated from existing assets that do not meet the 36-month window. "Electricity generated in states with robust greenhouse gas emissions caps paired with clean electricity standards or renewable portfolio standards" that meet specific criteria will automatically be considered as additional, the Treasury said. This is because in these states "the new electricity load" from electrolysers "is highly unlikely to cause induced grid emissions," it said, adding that rules on temporal matching and regional deliverability still apply. For now, "California and Washington are qualifying states under these final regulations," but other states could qualify in the future, according to the Treasury. Hourly matching — which prescribes that hydrogen has to be made from clean power produced within the same hour to avoid increased grid emissions — will now be required only from the start of 2030 onwards rather than from 2028. Annual matching will continue to apply until the end of 2029. The new phase-in date for hourly matching at the start of 2030 brings it in line with EU rules , although the bloc requires monthly rather than annual matching before then. US industry participants have repeatedly argued that the hourly matching rules drive up production costs and stymie the nascent industry's development, while environmentalists have warned that strict rules are necessary to curb greenhouse gas (GHG) emissions. The regional deliverability rules require electrolysers to source clean power from within their operating region — as defined by the Department of Energy — to avoid grid congestions between regions resulting in use of emissions-intensive power for hydrogen production. But the final guidelines would allow for direct "cross-region delivery" of power for hydrogen production where this "can be tracked and verified… on an hour-to-hour or more frequent basis". Under certain circumstances, US hydrogen producers could now even be eligible for the tax credits if they use electricity generated in Canada or Mexico, the Treasury said. ‘Significant improvements' A lobbying group representing the interests of hydrogen producers called the updated guidance "significant improvements" and said it would allow the industry to move forward to the next planning stage. "After years of strategic engagement and persistent advocacy, the issuance of this final rule now affords project developers the basis for evaluating opportunities to scale clean hydrogen deployments," Fuel Cell and Hydrogen Energy Association chief executive Frank Wolak said. A raft of hydrogen projects were announced in the US after President Joe Biden announced billions of dollars in funding and tax credits for hydrogen with the 2022 Inflation Reduction Act. But much of that euphoria fizzled out during the long wait for clarity on the rules and concerns that the Treasury's guidelines would be too strict to allow competitive production. Many would-be producers paused or cancelled US plans in 2024 because of widespread uncertainty over which projects would qualify for PTC, leaving companies unable to make long-term investment decisions. By Jasmina Kelemen and Stefan Krumpelmann Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Generic Hero Banner

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more