MDN’s Energy Stories of Interest: Fri, May 23, 2025 [FREE ACCESS]
NATIONAL: Senate votes to revoke California’s EV mandate; Natural gas futures flop after fourth straight triple-digit storage build; Why GE Vernova’s stock is power surging after just one year of existence; INTERNATIONAL: Deutsche Bank hits pause on new oil curbs, citing legal risk; Oil slips as OPEC eyes boost; Japan invests big in LNG despite climate-friendly promises; Egypt in talks to buy 40-60 LNG cargoes amid energy crunch, sources say.
NATIONAL
Senate votes to revoke California’s EV mandate
Energy in Depth
The U.S. Senate voted 51-44 to rescind California’s federal waiver, effectively blocking the state’s plan to ban new gas-powered car sales by 2035, using the Congressional Review Act (CRA). This decision, supported by Sen. Elissa Slotkin (D-MI) and Senate Republicans, targets three emissions waivers, including California’s EV mandate, which aimed to enforce zero-emission vehicle sales. The House had previously passed the measure with bipartisan support, reflecting widespread consumer and industry opposition to the mandate. The move is seen as a victory for consumer choice, preventing California from imposing nationwide vehicle policy. Energy trade groups, auto manufacturers, and consumer advocates praised the decision, while California’s high energy costs and grid strain were cited as reasons against forced EV adoption. California Attorney General Rob Bonta vowed to challenge the vote in court, arguing it undermines the state’s clean air efforts. President Trump is expected to sign the measure, fulfilling a campaign promise to end EV mandates. [MDN: Sanity is gradually returning since the last election. Cali can no longer control the entire country’s energy policies. This vote doesn’t need a presidential signature. It overturns a last-minute Biden attempt to strangle fossil energy vehicles. Good riddance!]
Natural gas futures flop after fourth straight triple-digit storage build
NGI’s Daily Gas Price Index
June Nymex natural gas futures declined for a second consecutive day, settling at $3.253/MMBtu, down 11.5 cents, driven by rapidly increasing storage inventories. The U.S. Energy Information Administration reported a 120 Bcf injection into storage for the week ending May 16, slightly above expectations, pushing Lower 48 inventories to 2,375 Bcf and widening the surplus to 90 Bcf above the five-year average. This marked the fourth consecutive week of over 100 Bcf builds, fueled by mild weather and robust production, exerting downward pressure on prices. Regional storage surpluses emerged in the East and South Central, while the Midwest retained a slight deficit. Spot gas prices dropped, with the national average falling 17.5 cents to $2.440, influenced by mild weather and strong renewable generation. Looking ahead, warmer June forecasts suggest stronger demand, potentially pausing large storage builds, while long-term fundamentals remain strong due to growing demand and limited new supply investments. [MDN: Yes, the NYMEX gas futures contract floats up and down (as it always does). However, what we notice is that it is not closing below $3, an important psychological barrier and an important profitability barrier. As long as we stay above $3, we’re good, although above $4 would be better.]
Why GE Vernova’s stock is power surging after just one year of existence
Fortune
GE Vernova, a spinoff from General Electric launched in April 2024, has seen its stock surge nearly 250%, reaching a $125 billion market cap, driven by booming demand for its gas turbine business despite an initial focus on renewables. The company’s success is fueled by a global surge in electricity demand, particularly from AI data centers, with a $4.5 billion increase in turbine and maintenance order backlogs in just three months. While its wind segment struggles with losses, GE Vernova’s gas turbines, which are compact and reliable, are in high demand, supported by a $14.2 billion deal in Saudi Arabia. The company is also advancing in nuclear energy, with approvals for small modular reactors in Canada and a planned U.S. project. CEO Scott Strazik emphasizes gas turbines as critical backups for renewables, positioning GE Vernova to capitalize on the ongoing energy investment supercycle. [MDN: GE Vernova dumped unreliable renewables but fast. It can’t manufacture and keep its gas turbines in stock fast enough! What a great time to be in the gas turbine business.]
INTERNATIONAL
Deutsche Bank hits pause on new oil curbs, citing legal risk
Bloomberg/Rigzone
Deutsche Bank AG has paused its plan to impose stricter restrictions on oil and gas financing due to heightened legal risks, as announced by CEO Christian Sewing at the bank’s annual general meeting. While assessing these risks, particularly in light of potential legal retaliation in the U.S. against banks perceived as boycotting fossil fuels, Sewing emphasized that the bank remains committed to its climate goals. Deutsche Bank has nearly finalized updated guidelines for the oil and gas sector, including limits on financing for oil sands, hydraulic fracking in specific regions, and Arctic exploration, though the implementation timeline remains uncertain. Sewing highlighted the bank’s role in financing the energy transition, noting that since 2019, sustainability has been a strategic priority. In 2024, the bank declined 15 out of 817 deals due to environmental and social concerns, reinforcing its commitment to managing climate risks while maintaining its 2050 net-zero target. [MDN: Crazy Euro weenies still want to strangle fossil fuel companies, but now they don’t dare because they know Trump and the U.S. government will cut them off. It’s working! See how electing a pro-energy president makes things better? Deutsche Bank, Germany’s largest bank, has a sizable business presence in the U.S.]
Oil slips as OPEC eyes boost
Bloomberg/Rigzone
Oil prices dropped to their lowest in nearly two weeks, with West Texas Intermediate settling at $61.20 and Brent at $64.44 per barrel, driven by rising US oil inventories and potential OPEC+ production increases. US commercial crude stocks rose for the second consecutive week, while gasoline and distillate demand weakened ahead of the summer driving season. OPEC+ is considering a 411,000-barrel-a-day output hike for July, marking the third consecutive month of significant supply boosts, primarily from Saudi Arabia. This move, combined with a well-supplied market, raises concerns about a potential oil glut. Additionally, the US-led trade war is fueling fears of slower economic growth and reduced energy demand, further pressuring prices. The combination of increased supply, rising inventories, and weakening demand signals challenges for oil markets in the near term. [MDN: The price is still in perfect territory, in the $60s. Less perfect is the $70s. The red mark above which we don’t want to see the price is higher than $80.]
Japan invests big in LNG despite climate-friendly promises
Bonn (Germany) Deutsche Welle
Despite Japan’s 2022 G7 pledge to halt fossil fuel funding, it remains a major financier of oil and gas, investing $93 billion from 2013 to 2024, with $56 billion in overseas LNG projects, compared to $24.5 billion for clean energy, according to a Solutions for Our Climate report. Japan promotes LNG as a “transitional fuel” through the Asia Zero Emission Community (AZEC), signing 70 MOUs with 11 Asian nations in 2024, focusing on gas, ammonia, and carbon capture. Critics, including Friends of the Earth Japan, call this greenwashing, citing a 2024 Cornell study showing LNG emits 33% more than coal when processing and shipping are considered. Loopholes in Japan’s pledge allow LNG investments if deemed “abated” or aligned with energy security or the Paris Agreement’s 1.5°C goal. In Indonesia, Japan’s LNG push risks locking in fossil fuel dependency, hindering renewable energy transitions. [MDN: So many things about this article are wrong. First, it assumes LNG is not “climate friendly.” That’s false. It also quotes a discredited (frankly, fraudulent) Cornell “study” that falsely claims LNG is worse for the planet than coal. That’s Bob Howarth, so-called professor at Cornell who makes such false claims about natural gas regularly. The point of bringing you this blurb is that Japan continues to invest in fossil fuels, particularly LNG. That’s something we can all support. Hats off to the Japanese for being smart.]
Egypt in talks to buy 40-60 LNG cargoes amid energy crunch, sources say
Reuters
Egypt is negotiating with energy firms and trading houses to purchase 40-60 liquefied natural gas (LNG) cargoes to address a worsening energy crisis ahead of peak summer demand, according to three sources cited by Reuters. The country, grappling with a foreign currency shortage, faces spending up to $3 billion to secure these cargoes, exacerbating financial strain amid declining domestic gas production and a cost-of-living crisis. President Abdel Fattah al-Sisi has directed the government to ensure stable electricity flow. Egypt is also considering importing around 1 million tons of fuel oil if LNG prices are unfavorable. The nation’s gas output hit a nine-year low in February, and it relies heavily on Israeli gas, which may become costlier as Israel seeks a 25% price increase. Reduced supply from Israel’s Leviathan field has already forced Egypt to cut gas to fertilizer factories, threatening exports and foreign currency earnings. [MDN: A potential new customer for U.S. LNG. Note to M-U drillers — go get ’em!]