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The Verge
2 days ago
- Business
- The Verge
Trump's AI plan is a massive handout to gas and chemical companies
The Trump administration put out its vision for AI infrastructure in the US last week. It's a dream for the fossil fuel and chemical industries — and a nightmare for wind and solar energy and the environment. An 'AI Action Plan' and flurry of executive orders Donald Trump signed last week read like manifestos on making AI less 'woke' and less regulated. They're packed with head-spinning proposals to erode bedrock environmental protections in the US, on top of incentives for companies to build out new data centers, power plants, pipelines, and computer chip factories as fast as they can. It's a deregulation spree and a massive handout to fossil fuels, all in the name of AI. What the AI plan 'is really about' is 'using unprecedented emergency powers to grant massive new exemptions for data centers and specifically fossil fuel infrastructure,' says Tyson Slocum, energy program director at the consumer advocacy group Public Citizen. 'I think they have a genuine interest in accommodating Big Tech's priorities. But it's an opportunity to marry their priorities for Big Oil.' 'It's an opportunity to marry their priorities for Big Oil.' Data centers are notoriously energy-hungry and have already led to a surge of new gas projects meant to satiate rising demand. But many tech companies have sustainability commitments they've pledged to meet using renewable energy, and as wind and solar farms have generally grown cheaper and easier to build than fossil fuel power plants, they've become the fastest-growing sources of new electricity in the US. Now, Trump wants to turn that on its head. He signed an executive order on July 23rd meant to 'accelerat[e] federal permitting of data center infrastructure.' It tells the Secretary of Commerce to 'launch an initiative to provide financial support' for data centers and related infrastructure projects. That could include loans, grants, and tax incentives for energy infrastructure — but not for solar and wind power. The executive order describes 'covered components' as 'natural gas turbines, coal power equipment, nuclear power equipment, geothermal power equipment' and any other electricity sources considered 'dispatchable.' To be considered dispatchable, operators have to be able to ramp electricity generation up and down at will, so this excludes intermittent renewables like solar and wind power that naturally fluctuate with the weather and time of day. Trump's AI planning document similarly says the administration will prioritize deploying dispatchable power sources and that 'we will continue to reject radical climate dogma.' Already, Trump has dealt killer blows to solar and wind projects by hiking up tariffs and cutting Biden-era tax credits for renewables. The AI executive order goes even further to entrench reliance on fossil fuels and make it harder for new data centers to run on solar and wind energy. 'Right now, you do not qualify for expedited treatment if your data center proposal has wind and solar. It is excluded from favorable treatment,' Slocum says. 'So what's the statement for the market? Don't rely on wind and solar.' That's not just environmentally unfriendly, it's inefficient — considering the current backlog for gas turbines and because fossil fuel plants are generally slower and more expensive to build than onshore wind and solar farms. 'This is not an energy abundance agenda. This is an energy idiot agenda,' Slocum adds. The Trump administration wants to speed things up by rewriting bedrock environmental laws. Trump, ever the disgruntled real estate mogul, has railed against environmental reviews he says take too long and cost too much. He has already worked to roll back dozens of environmental regulations since stepping into office. Now, the executive order directs the Environmental Protection Agency (EPA) to modify rules under the Clean Air Act, Clean Water Act, Superfund law, and Toxic Substances Control Act to expedite permitting for data center projects. 'That is horrifying … These [laws] protect our public health. They protect our children. They protect the air we breathe and the water we drink,' says Judith Barish, coalition director of CHIPS Communities United, a national coalition that includes labor and environmental groups. 'This is an energy idiot agenda.' The coalition has come together to fight for protections for workers in the chip industry and nearby communities. Semiconductor manufacturing has a long history of leaching harmful chemicals and exposing employees to reproductive health toxins. Santa Clara, California, home of Silicon Valley, has more toxic Superfund sites than any other county in the US as a result. The coalition wants to keep history from repeating itself as the US tries to revive domestic chip manufacturing and dominate the AI market. AI requires more powerful chips, and Trump's executive order fast-tracking federal permitting for data center projects includes semiconductors and 'semiconductor materials.' Barish says 'a chip factory is a chemical factory' because of all the industrial solvents and other chemicals semiconductor manufacturers use. That includes 'forever chemicals,' for which the Trump administration has started to loosen regulations on how much is allowed in drinking water. Companies including 3M and Dupont have faced a landslide of lawsuits over forever chemicals linked to cancer, reproductive risks, liver damage, and other health issues, and have subsequently made pledges to phase out or phase down the chemicals. Now, manufacturers are jumping on the opportunity to produce more forever chemicals to feed the AI craze. Ironically, we could see data centers and related infrastructure popping up on polluted Superfund sites that Silicon Valley has already left in its tracks. Trump's executive order directs the EPA to identify polluted Superfund and Brownfield sites that could be reused for new data center projects (and tells other agencies to scour military sites and federal lands for suitable locations). Office buildings are already situated on or adjacent to old Superfund sites where cleanup is ongoing; Google workers were exposed to toxic vapors rising from a Superfund site below their office back in 2013. Since it can take decades to fully remediate a site, oversight is key. 'For Superfund sites in particular, these are the most contaminated sites in the country, and it is important that there are comprehensive reviews both for the people who are going to be working on the sites, as well as for the people who surround them,' says Jennifer Liss Ohayon, a research scientist at the Silent Spring Institute who has studied the remediation of Superfund sites. But Trump wants to erode oversight for new data center projects that receive federal support — adding 'categorical exclusions' to typical National Environmental Policy Act assessments. Environmental reviews that do take place could also be limited by the sheer lack of people power at federal agencies the Trump administration has hacked to pieces, including the EPA. 'America needs new data centers, new semiconductor and chip manufacturing facilities, new power plants and transmission lines,' Trump said before signing his AI executive orders last week. 'Under my leadership we're going to get that job done and it's going to be done with certainty and with environmental protection and all of the things we have to do to get it done properly.' Good luck. Posts from this author will be added to your daily email digest and your homepage feed. See All by Justine Calma Posts from this topic will be added to your daily email digest and your homepage feed. See All AI Posts from this topic will be added to your daily email digest and your homepage feed. See All Analysis Posts from this topic will be added to your daily email digest and your homepage feed. See All Climate Posts from this topic will be added to your daily email digest and your homepage feed. See All Environment Posts from this topic will be added to your daily email digest and your homepage feed. See All Policy Posts from this topic will be added to your daily email digest and your homepage feed. 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Bloomberg
7 days ago
- Business
- Bloomberg
BP Plans to Exit $36 Billion Australian Green Hydrogen Project
BP Plc will exit its role in a massive green hydrogen production facility planned in Australia as the British oil major refocuses on the fossil fuels that drive its profits. The company told its partners in the Australian Renewable Energy Hub that it plans to leave the project as both operator and equity holder, according to a statement from a BP spokesperson. It's the latest setback for green hydrogen, a fuel once touted as a key way for Big Oil to profit from the energy transition but that has so far proved too costly for mass production and consumption.
Los Angeles Times
18-07-2025
- Business
- Los Angeles Times
Chevron prevails in Exxon fight and closes deal to buy Hess
Chevron Corp. won its arbitration battle with Exxon Mobil Corp. and has closed its $53 billion deal to buy Hess Corp. more than 20 months after the takeover was announced. The decision is a major victory for Chevron, ending a period of strategic limbo that hurt its stock and prompted questions over the quality of the company's due diligence when it agreed to buy Hess in October 2023. Chevron Chief Executive Officer Mike Wirth said he would walk away from the deal if they lost the case. 'This merger of two great American companies brings together the best in the industry,' Wirth said in a statement. Hess shares surged as much as 8.8% before the start of regular trading. Chevron rose 4.1%. The clash between North America's biggest energy producers was unprecedented in the modern history of Big Oil, an industry in which companies routinely partner with each other to minimize project risk and share costs. Exxon, which operates and owns 45% of Guyana's offshore Stabroek Block, claimed it had a right of first refusal over the disposition of Hess's 30% stake. Hess and Chevron, however, argued the right didn't apply because their deal was structured as a corporate merger rather than an asset sale. The uncertainty surrounding the deal has been a 'material contributor' to the underperformance of Chevron's stock price compared to its rivals, Wirth said in November. Acquiring Hess and its stake in Guyana significantly increases the quality of Chevron's oil assets beyond the Permian Basin of Texas and New Mexico, narrowing the gap with Exxon, Hedgeye Risk Management, LLC Managing Director Fernando Valle said. 'Adding Guyana was critical for Chevron, because it's go-forward portfolio was paltry outside of the Permian,' Valle said. Both sides had expressed extreme confidence in their opposing positions on the wording of the Guyana contract, which was written more than 15 years ago. 'We wrote these documents — we understood the intent of those documents,' Exxon Chief Executive Officer Darren Woods said in December. 'That gives us a lot of confidence in the position that we've taken.' Wirth and John Hess consistently backed their legal advice throughout the process. The deal's completion is a win for arbitrage traders who were betting on the spread between Hess's share price and the exchange ratio agreed with Chevron. Hedge funds including Millennium Management, Pentwater Capital Management and HBK Investments LP had staked billions of dollars on the deal closing, according to data compiled by Bloomberg. The deal calls for Hess shareholders will receive 1.0250 Chevron shares for each Hess share. Chevron plans intends to issue about 301 million shares of common stock as part of the transaction. The US Federal Trade Commission on Thursday opened the door for John Hess to join Chevron's board, throwing out an order issued last year that barred him from doing so and accused him of colluding with OPEC. 'Mr. Hess is a highly respected industry leader, and our board would benefit from his global experience, relationships and expertise,' a Chevron spokesman said in a statement. Crowley and Wethe write for Bloomberg.
Newsweek
18-07-2025
- Business
- Newsweek
Hawaii State Senator: Did Your Home Insurance Bill Increase? Big Oil Should Pay Up
Imagine getting a letter from your home insurance company explaining that your annual bill was going to be 10 times higher this year, even though you'd never made a claim for damages to your home. Thousands of American homeowners—including many in my home state of Hawaii—don't need to imagine. Last year, insurers in our state drastically raised rates to reflect the increasing threat of extreme weather disasters and to recoup money they had to pay out after the deadly 2023 Maui wildfires. But why should everyday people be asked to shoulder these costs, while an industry that actively made the problem worse pays nothing? Giant fossil fuel corporations predicted decades ago that the unchecked burning of their products could lead to out of control weather disasters, creating chaos in insurance markets. Don't they bear some of the responsibility for making this nightmare a reality? Debris removal at a former apartment building in the Lahaina wildfire impact zone on August 2, 2024, in Lahaina, Hawaii. Debris removal at a former apartment building in the Lahaina wildfire impact zone on August 2, 2024, in Lahaina, shouldn't push the costs of climate change on to their policyholders while letting the companies causing it off the hook. That's why Hawaii is pursuing a fairer model that other states can emulate: make the fossil fuel industry help pick up the tab. Our state recently passed a first of its kind resolution encouraging insurance companies to take Big Oil to court for climate damages before raising rates on their customers. Simply put: fossil fuel-driven climate change is creating a nationwide cost-of-living crisis, especially when it comes to housing. Supercharged wildfires in Los Angeles and Maui and unprecedented flooding in the Carolinas from Hurricane Helene have displaced thousands of Americans. When they do get a check from their insurance company, many find that it only covers a fraction of the cost of rebuilding their homes. Faced with mounting claims, insurance companies are pulling out of entire communities, canceling existing policies, and refusing to issue new policies. Given that insurance is generally required on new mortgages, uninsurable homes are essentially unsellable homes. Mortgage lenders in wildfire-stricken Colorado communities are reporting a rash of home sales falling apart because buyers can't secure insurance. Experts warn that this growing crisis threatens to infect the broader economy. In a recent Senate hearing, Senator Sheldon Whitehouse (D-R.I.) warned of an "economic cascade" of consequences for real estate markets, and cited a Freddie Mac chief economist predicting that if left unchecked, the insurance crisis could cause "a 2008-style economic recession." We're on track for economic disaster, while fossil fuel industry giants who put us in this position keep raking in billions of dollars in profits. Rather than pulling the rug out from under hardworking families and abandoning entire communities, insurance companies should make the fossil fuel industry pay their fair share of the costs. While they may not seem like the most likely group to hold the fossil fuel industry accountable, insurance companies are already well-practiced in taking bad actors to court for their role in extreme weather disasters. When utilities' unmaintained power lines ignited devastating wildfires in California in 2017 and 2018, insurers successfully forced them to pay up, temporarily reducing the severity of rate increases on homeowners and slowing the trend of insurance companies fleeing the state. Just like the companies who sparked a blaze, the fossil fuel industry bears responsibility for contributing to the soaring high temperatures and drier atmosphere that turn a routine forest fire into a blazing inferno. Researchers who measure climate change's contribution to extreme weather disasters estimate that companies like Chevron and ExxonMobil are each responsible for nearly $2 trillion in economic losses from extreme heat between 1991 and 2020. This isn't a surprise to Big Oil—internal documents show their researchers warning as far back as the 1970s that their products would warm the global climate and fuel "potentially catastrophic events." Industry executives were convinced enough to invest in making their own oil wells and pipelines resilient to climate change, while also working for decades to mislead the public about their products' connection to the problem. That deception continues today, with oil and gas majors proudly advertising their commitment to clean energy while they ramp up the production and burning of fossil fuels. Since 2002, climate change has cost the insurance industry an estimated $600 billion in insured losses, costs that were likely recouped from consumers through higher premiums. The oil and gas industry, which has averaged nearly $3 billion in profit per day, could have covered those losses without breaking a sweat. As policymakers nationwide grapple with a growing insurance crisis, our first priority should be to protect consumers from extreme rate hikes and stabilize markets for insurers. When you make a mess, you clean up after yourself. It's time for the fossil fuel industry to do the same. Chris Lee serves as president of the National Caucus of Environmental Legislators, a bi-partisan organization of 1,500 state legislators from all 50 states. He has served in the Hawaii State Legislature since 2008, where he authored the nation's first state laws transitioning utilities to 100 percent renewable energy, directing economy-wide carbon neutrality, and targeting zero-emissions transportation. The views expressed in this article are the writer's own.
Globe and Mail
16-07-2025
- Business
- Globe and Mail
The Zacks Analyst Blog Highlights ExxonMobil, Shell and BP
For Immediate Release Chicago, IL – July 16, 2025 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: ExxonMobil XOM, Shell SHEL and BP BP. Here are highlights from Tuesday's Analyst Blog: Big Oil's Q2 Outlook: Downstream Gains, Upstream Pains The upcoming earnings reports for big oil and energy companies will tell a story of two different worlds. On the one hand, we will likely see lower profits from simply drilling for oil and gas (or the 'upstream' side of the business). On the other hand, businesses that refine crude oil into products like gasoline and make chemicals (known as 'downstream') might show surprising strength. Major players like ExxonMobil, Shell and BP have already given us hints. They are seeing profits squeezed from falling oil and gas prices. So, as these companies share their results in the coming weeks, everyone will be watching their ability to control costs, how well their refineries performed, and if demand for energy is truly recovering. ExxonMobil: Leaning on Refineries to Counter Lower Prices ExxonMobil, the world's largest integrated energy company, expects its second-quarter earnings to take a hit because of lower oil and gas prices. The American supermajor recently warned that its upstream earnings could fall by as much as $1.9 billion from the first-quarter level. This big drop is mostly due to oil prices bringing in $1.2 billion less, and natural gas prices adding up to a $700 million hit. Data from the U.S. Energy Information Administration ("EIA") confirms this trend: WTI crude oil averaged just $63.54 in April and $68.17 in June, down from $75.74 in January. But it's not all bad news for ExxonMobil. It might actually see a modest boost from its refining and chemical businesses, with refining profits potentially adding between $100 million and $500 million. However, planned maintenance work and other timing issues could lessen those gains. With the Zacks Consensus Estimate for ExxonMobil's EPS down nearly 33% from last year to $1.44, the pressure is squarely on its non-drilling segments to stabilize the overall results. BP: Production Up, But Prices Down London-based BP is heading into its second-quarter earnings with a mixed bag of expectations. On the bright side, the Zacks Rank #3 (Hold) company expects to pump out more oil and gas than initially predicted, and even more than it did in the first quarter. This boost is largely thanks to higher output from their U.S. shale operations. However, BP has also warned that lower crude oil prices will hit its drilling profits hard, by about $800 million. Weaker natural gas prices are also expected to weigh on earnings, though to a lesser extent. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Where BP might really shine is in its refining business. It anticipates refining profits jumping from $15.20 per barrel in the first quarter to $21.10 in the second. This could potentially boost its "customers and products" segment by $300 million to $500 million. Plus, BP expects its total debt to dip below the first-quarter level of $27 billion, indicating sound financial management. With the consensus EPS mark at 60 cents (down 40% from last year), any gains from refining will be vital in cushioning the blow from weaker oil and gas prices. Shell: Navigating Headwinds With Refining Strength Europe's largest oil company, Shell, is also facing a challenging quarter, with several parts of its business dealing with headwinds. The company expects second-quarter average production for its Integrated Gas division to be 900,000–940,000 barrels of oil equivalent per day compared with 927,000 achieved in the January-March period. LNG output is now expected to be between 6.4 million and 6.8 million tons, and gas trading results are likely to be weaker than in the first quarter. On the traditional drilling side, production is expected to decline to 1.66 million–1.76 million barrels of oil equivalent per day, due to both scheduled maintenance and the sale of its Nigerian SPDC assets. Still, Shell's refining margins look strong, rising from $6.20 per barrel in the first quarter to $8.90 per barrel in the second. This is supported by better utilization of its refineries. However, the company's chemicals business is expected to report a loss due to unplanned shutdowns at its Monaca plant. Shell's renewables and energy solutions segment's bottom line will likely be between $400 million loss and $200 million profit. The Zacks Consensus Estimate for Shell's EPS is pegged at $1.44, down 27% from last year, as the company relies on its marketing and refining arms to offset broader weak The Outlook: Silver Linings for Energy Investors As is evident, the refining side of the energy business is showing remarkable strength. Companies like ExxonMobil, BP and Shell are seeing much better profits from turning crude oil into fuels and other products. That's why, despite the pressure on oil and gas drilling operations due to lower prices, the second-quarter outlook for energy investors isn't entirely gloomy. Looking ahead, global demand for oil remains steady, with summer travel and increased electricity use driving higher consumption. Demand for natural gas in the United States is also growing stronger, thanks to mid-summer heat and improving flows of LNG exports. As companies maintain discipline in their supply and excess inventories slowly return to normal levels, the stage could be set for firmer prices in the second half of 2025. Research Chief Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months. Free: See Our Top Stock And 4 Runners Up Media Contact Zacks Investment Research 800-767-3771 ext. 9339 support@ Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit for information about the performance numbers displayed in this press release. Only $1 to See All Zacks' Buys and Sells We're not kidding. Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent. Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators, and more, that closed 256 positions with double- and triple-digit gains in 2024 alone. See Stocks Now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BP p.l.c. (BP): Free Stock Analysis Report Exxon Mobil Corporation (XOM): Free Stock Analysis Report
