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US NOW CALLING THE SHOTS ON GLOBAL OIL PRICES: The U.S. producing a record amount of oil, and exporting an increasing amount of it too, means it has become just as influential on the price of oil as OPEC and Russia.

The Energy Information Administration said as much in releasing its latest oil market data on Wednesday: “Crude oil production from the world’s three largest producers — the United States, Russia, and Saudi Arabia — were at or near record levels.”

The advantage of being a net exporter: The EIA also confirmed what industry reported last week, which is that the U.S. became a net exporter of oil and other petroleum products in November, the first time that’s happened after the U.S. became a net natural gas exporter last year.

The International Energy Agency confirmed the same thing on Thursday with a caveat. It said it might be an “isolated” event. The international agency also projected that the U.S. will continue to have major influence over the world oil market, labeling it part of the “Big Three” oil producers.

US and Iran waivers keeping prices low: All of this equates to lower oil prices because of the laws of supply and demand. There is simply too much oil on the market. That has spurred Saudi Arabia to lead OPEC with Russia to curb production so prices don’t go too low.

EIA said that several factors lowered oil prices in November. First, the U.S., Russia, and Saudi are producing too much oil. Second, the Trump administration granting waivers for some of Iran’s largest customers to continue importing Iranian crude oil for six months. Third, fears that the global economy could slow have curbed demand for oil.

But that won’t slow US production: The agency is predicting that U.S. crude oil production will continue to rise to new record-high levels each month through May 2019, which will continue push prices down, despite the recent OPEC agreement.

After May, however, U.S. crude oil production will remain relatively flat until September, which may mean prices will rise.

EIA expects U.S. crude oil production will average 10.9 million barrels per day in 2018 and 12.1 million barrels per day in 2019.

Welcome to Daily on Energy, compiled by Washington Examiner Energy and Environment Writers John Siciliano (@JohnDSiciliano) and Josh Siegel (@SiegelScribe). Email [email protected] for tips, suggestions, calendar items and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email and we’ll add you to our list.  

OPEC BOOSTS OUTPUT AHEAD OF PRODUCTION CUT AGREEMENT: The IEA report also noted that OPEC increased production last month, driven by record output from Saudi Arabia, ahead of a new deal to be implemented in January to pump the brakes.

OPEC’s crude oil output rose 100,000 barrels per day, to 33.03 million barrels a day in November. Saudi Arabia, OPEC’s largest producer, increased production by 410,000 barrels a day to a record high of 11.06 million barrels a day.

Together, OPEC’s higher production “more than” offset sanction-induced losses from Iran.

Oil production cut pact may have little impact: But OPEC and non-member Russia shifted course last week because prices had fallen too much, agreeing to an oil production cut of 1.2 million barrels per day.

The cut will begin in January, lasting for six months before the group reviews whether to continue forward after that.

Despite the new deal, IEA says the Brent crude oil price “seems to have found a floor” at close to $60 a barrel, compared to when it breached $85 per barrel in October as the Iran sanctions were implemented.

PERRY STRUGGLES TO WEAN IRAQ OFF OF IRAN’S ENERGY: Energy Secretary Rick Perry spent the last two days trying to convince the Iraqi government that it’s in its best interest to cut energy ties with Iran, but with limited success.

To review: Iraq wants special exemptions from Iran sanctions to continue importing Iranian natural gas for the long term. Iraq’s electric grid is dependent on natural gas power plants to keep the lights on and its oil economy humming.

But that didn’t stop Perry from making the case that American industry could help Baghdad reduce its dependence on Iran.

Iranian advisors arrived in Baghdad ahead of Perry: Perry arrived in Baghdad just days after advisers from Iran sat down with Iraq’s Minister of Electricity Luay al-Khatteeb on Dec. 9. Al-Khatteeb posted a photo from his meeting with the Iranian delegation on both Twitter and his Facebook page.

Al-Khatteeb met with Mr. Hasan Dremob Fer, advisor to the President of the Islamic Republic of Iran for Economic affairs between Iraq and Iran, according to a translation of a Dec. 9 Twitter post which was in Arabic.

Sounds familiar: He discussed with Iran “the prospects for joint cooperation in the field of #energy between the two countries.”

Perry met with both Iraqi Minister of Oil Thamir Ghadhban and Al-Khatteeb on Wednesday to discuss the importance of a “transparent, predictable, and accountable business environment to attract investment in Iraq’s energy sector,” Perry tweeted.

Did someone just get played? Al-Khatteeb tweeted early on Thursday that Iraq is “looking forward to stronger partnership and continuous joint cooperation with the United States and allies as we embark on #Iraq’s #powerrenaissance.”

REPUBLICANS ARE EAGER FOR JOE MANCHIN TO RISE ON ENERGY PANEL: Colleagues and supporters of Sen. Joe Manchin of West Virginia, who’s set to be the top Democrat on the Senate Energy and Natural Resources Committee, tell Josh that it’s superficial to label the coal-state senator simply “pro-coal” and that his ambitions for working with Republicans extend to clean energy legislation.

“He is not a shill,” said Jan Brunner, a former energy policy adviser to Manchin. “He will do a balancing act of, ‘I understand climate change is a thing, but it’s complicated.’ Eventually we will get to somewhere where there are not fossil fuels, but we are not there yet.”

Working together on reducing emissions: Indeed, Senate Republicans tell Josh they are eager to work with Manchin not to save the coal industry, which they view as impracticable, but on clean energy development, in a piecemeal manner that recognizes the elusiveness of comprehensive legislation to combat climate change.

“Joe is bipartisan and really is an all-of-the-above guy,” said Sen. John Hoeven, D-N.D., a committee member. “He is for traditional energy — fossil fuels — and renewables too.”

Greens are worried: Manchin nabbed the ranking member slot this week over the complaints of environmental groups worried that he could use it to impede aggressive climate change legislation (remember — he’s the guy who once literally shot cap-and-trade legislation).

Checking his record: Republican senators say that, stunts apart, Manchin’s true policy preferences lie somewhere in the middle.

Hoeven noted that Manchin has worked with him on bills with an environmental focus, such as 2016 legislation to allow states to create a permit program to safely dispose of coal ash, the toxic waste left over from burning coal for electricity production.

Areas of cooperation: Manchin has also supported legislation to boost carbon capture and storage, which traps carbon emissions from power plants and industries and stores it underground.

Read Josh’s full story, including other areas of potential cooperation between Manchin and Republicans, here.

SENATE DEMOCRATS CALL ON MCNAMEE TO RECUSE HIMSELF FROM COAL SUBSIDIES: Seventeen Senate Democrats on Wednesday called on Bernard McNamee, the newest commissioner of the Federal Energy Regulatory Commission, to recuse himself from matters related to consideration of subsides for retiring coal and nuclear plants.

All Energy and Natural Resources Committee members joined the recusal call, in a letter to McNamee, except for a notable exception — Manchin.

Manchin, if you recall, recently flipped his vote on McNamee, choosing to oppose him because of previous comments downplaying climate change and supporting fossil fuels at the expense of renewables.

McNamee, during his confirmation hearing, would not commit to recusing himself, despite his previous work with the Department of Energy on a proposal to subsidize coal and nuclear plants.

TRUMP SIGNS BIPARTISAN EARTHQUAKE BILL: The U.S. just got a little safer from earthquakes on Wednesday, with the president signing a bill to establish a robust early warning systems in earthquake prone areas of the country.

The two lead sponsors of the bill were Sens. Lisa Murkowski, R-Alaska, chairwoman of the Energy and Natural Resources Committee, and Diane Feinstein of California, the top Democrat on the Appropriation Committee’s panel on Energy and Water Development.

The bill passes not even two weeks after a magnitude 7.0 earthquake struck a few miles north of Anchorage, Murkowski noted in a statement on the bill being signed.

“Alaskans’ response is a testament to our resilience and grit, but we also know there is still more that can be done, which is why the enactment of this legislation could not be more timely,” she said.

GORE SAYS ‘NO’ TO CARBON CAPTURE FOR COAL: Former Vice President Al Gore said carbon capture and storage for fossil fuels is an “improbable” technology, especially when renewable energy is more competitive right now.

“I just think it’s an extremely improbable solution right now, but maybe they will come up with some breakthrough,” Gore said in an interview with Axios on the sidelines of the COP24 United Nations climate summit in Poland. “There are so many fossil-fuel burning installations now that they are just shutting down well before their useful lifetime because it’s just simply cheaper to move to” renewable energy.

Josh wrote a story earlier this week illustrating that several companies are still supporting the technology, which strips out carbon dioxide emissions after coal or natural gas is burnt to make electricity.

Trump’s Environmental Protection Agency recently issued a rule that changed Obama-era climate regulations for building new coal plants by removing the requirements for adding carbon capture and storage to new coal plants.

The inclusion of carbon capture in the Obama-era standard was considered too expensive to implement by industry, acting as a de facto ban on coal plants.

MEANWHILE…TRUMP TARIFFS HURT SOLAR PROJECTS IN THE THIRD QUARTER: Trump’s tariffs have stifled growth for large-sized solar arrays in the third quarter, the industry’s lead trade group reported Thursday.

The administration’s section 201 tariffs on solar panels “took a toll” on large utility-scale solar projects in the third quarter, the Solar Energy Industries Association said in releasing its third-quarter business report with the consulting firm Wood Mackenzie.

The tariffs were some of the first to be imposed by the Trump administration in 2018, targeting imports of solar panels and modules from Europe and Asia. The solar trade group had pressed the White House not to move forward with the protectionist measures, saying it would do harm to an industry that has been growing.

INTERIOR HOLDS OFFSHORE WIND AUCTION FOR MASSACHUSETTS COAST: The Interior Department’s Bureau of Ocean Energy Management is holding an offshore wind auction Thursday morning for federal waters off the coast of Massachusetts.

The auction covers 390,000 acres, with 19 companies qualified to participate. That opportunity could support 4.1 gigawatts of electricity and power nearly 1.5 million homes, Interior Secretary Ryan Zinke said in announcing the sale this October.

Zinke is ‘bullish’ on offshore wind: Zinke has previously told Josh that he is “bullish” about offshore wind, working with government leaders in the Northeast to transform what was once a fringe and costly investment into America’s newest energy-producing industry.

As the cost of onshore renewables drops, offshore wind represents perhaps the biggest clean energy opportunity of them all, and allows for the Trump administration to show it does not care only about fossil fuels.

Block Island, a small 30-megawatt wind farm off the Rhode Island coast that can power 17,000 homes, is the nation’s only current offshore project.

Zinke also said he plans to begin a process to auction offshore federal waters off the coast of California for the first time ever.

RUNDOWN

S&P Global EPA sees no new coal plants from its CO2 rule, but it could still help industry

Bloomberg Global bankers spurn Trump’s pleas to keep making loans for coal

Washington Post Climate talks at risk of failure as US leaves a leadership void

Politico Why Trump can’t kill the electric car

Reuters OPEC exit frees Qatar from US legal concerns

SPONSOR MESSAGE: Lawmakers on both sides of the aisle have spoken about supporting improvements to America’s infrastructure, with little ever being done. Now politicians have an opportunity to bridge the bipartisan divide and work to rebuild the nation’s roads, bridges, pipelines, and waterways. When lawmakers reconvene in Washington in January, GAIN encourages returning and newly-elected officials to find common ground to grow America’s infrastructure. To learn more and stay up to date on the latest go towww.gainnow.org or follow us @GAINNowAmerica.