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DAILY ENERGY NEWS | 05/21/2024

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I'm surprised it took this long for them to call this play.

Inside Sources (5/13/24) reports: "When a container ship slammed into Baltimore’s Francis Scott Key Bridge, traffic halted not just on I-695 but also at the third-largest port on the Eastern Seaboard. The Port of Baltimore is one of the nation’s top 10 for international trade. It’s number one for the import and export of cars and light trucks. It’s also the nation’s second-largest terminal for coal exports, and that’s where the so-called 'Rahm Emanuel' effect has kicked in. Following the advice of President Barack Obama’s former chief of staff and consigliere ('You never want a serious crisis to go to waste'), some environmental activists have called upon the tragic bridge collapse as a rationale to bring down a permanent closure of the CSX coal terminal at the Port of Baltimore. The U.S. Energy Information Administration (EIA) has tracked coal exports leaving the broader Port of Baltimore and has reported that annual coal exports departing have averaged 20 million short tons in three of the past five years. As a result of the railroad’s federal common carrier obligations, the majority of that coal, roughly 14 million short tons, moves through the CSX piers in Curtis Bay, most of it to American allies like India, Japan, and the Netherlands. According to a recent impact study by Martin Associates, the Curtis Bay facility supports 1,400 jobs and brings in $335 million in economic value each year."

"From shutting down the Keystone Pipeline to banning energy leases on federal land, Joe Biden’s top-down policies have stifled our country’s energy resources and made even things like a family road trip more expensive."

– Akash Chougule, Americans for Prosperity

What happens in California needs to stay in California.

Arizona Republic (5/21/24) op-ed: "As neighbors go, I’ve always thought of Gavin Newsom as basically harmless, another big-mouth, small-game California governor trying to manage a state that is essentially ungovernable. But it turns out I was wrong. Gavin Newsom is not harmless. In fact, his fantasies of turning California into the embodiment of the Green New Deal have become expensive for neighboring Arizona and Nevada. Newsom, who either slept through Economics 101 or is lying — I’m guessing both — blames California’s highest gas prices in the nation on the 'greedy' oil companies. His solution is to put a cap on oil company 'profits' and essentially tax — once again — the oil companies for having the audacity of doing what all businesses do, which is try to maximize profits. Newsom’s plan has the potential to impose new costs on California refineries that will be passed on to consumers and will push California toward $6-per-gallon gas, Wall Street Journal columnist Allysia Finley writes. Here’s the problem for the neighborhood. Arizona gets roughly 50% to 60% (depending on the source) of its gasoline from California refineries. (The other portion comes from New Mexico and West Texas). Nevada gets 88% of its fuel from California."

The net-zero religion remains priority number one at EPA.

Real Clear Energy (5/20/24) reports: "Coal and natural gas plants provide 60% of the U.S.’ affordable, reliable, and baseload power. In a time of increased electricity demand, America needs to double down on harnessing these sources—not abandon them. The Environmental Protection Agency (EPA)’s recently finalized Clean Power Plan 2.0 (CPP) rule, however, takes the country in the wrong direction. Under this regulation, one that is arguably illegal, existing coal and new natural gas power plants will be mandated to install emissions control technologies that aren’t yet commercially viable. Plants that don’t comply risk permanent closure. This unrealistic mandate is advanced under the guise of reducing greenhouse gas emissions 90% by 2032... The EPA rule would lead to grid instability because operators will be forced to adopt intermittent, unreliable, and costly sources like wind and solar. According to the Department of Energy, wind is only reliable 33.5% of the year while solar is dependable for just 24.9% of the time. Wind energy generation decreased for the first time last year. The federal government reports wind generation hit maturity with slower recorded wind speeds, despite adding 6.2 gigawatts of new wind capacity. Solar energy also had a bad 2023 with over 100 companies going bankrupt and expensive electricity rates. Many planned solar plants, including those receiving Inflation Reduction Act subsidies, are predicted to be canceled this year due to price collapse and waning demand."

It's coming sooner than you think.

CNET (5/16/24) reports: "Certain areas of the US will face an elevated risk of energy shortages this summer, according to a seasonal grid reliability assessment from the North American Electric Reliability Corporation (NERC). The report highlights regions of North America that could face grid reliability issues, thanks to too little supply of or too much demand for power. While this year's summer grid outlook is better than last year's, there are still some areas of the US that fall under an elevated risk of energy shortage and blackouts during unexpected extreme heat events. These areas could face blackouts 'under an event that is on the caliber of a once-per-decade heat wave,' said Mark Olson, manager of reliability assessments at NERC."

Energy Markets

WTI Crude Oil: ↓ $78.73
Natural Gas: ↑ $2.78
Gasoline: ↑ $3.60

Diesel: ↑ $3.91
Heating Oil: ↓ $246.18
Brent Crude Oil: ↓ $82.74
US Rig Count: ↓ 627

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