Welcome to Daily on Energy, written by Washington Examiner energy and environment writers Callie Patteson (@CalliePatteson) and Maydeen Merino (@MaydeenMerino). Email cpatteson@washingtonexaminer dot com or mmerino@washingtonexaminer dot com 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.

QUOTE OF THE WEEK: Earlier this week, United Airlines CEO Scott Kirby defended his assessment that oil will remain above $100 per barrel until the end of 2027, pushing back against the Trump administration’s own prediction that prices will drop relatively quickly once the Iran war ends. 

“Even once the Straits of Hormuz are open, it seems like a reasonable assumption for us to make. And-and so we want to plan for something like that. We hope it’s better, but the cost of planning for something like that is pretty small,” Kirby told CNBC, adding that United is willing to do what it can to curb the high prices. “We’re going to do a little less flying than we otherwise would, willing to leave a little bit of demand on the table if oil prices are lower, but want to be prepared for a scenario where oil prices are higher for longer.”

EPA FINALIZES RENEWABLE FUEL STANDARD: President Donald Trump hosted farmers at the White House today, announcing several measures for the agricultural sector, including the finalized biofuel blending standards. 

The president announced that the Environmental Protection Agency finalized its Renewable Fuel Standard “Set 2” requirements. The program requires transportation fuel to contain an increasing volume of renewable fuel, which creates a market for corn- and soy-based ethanol fuel. 

The EPA’s final rule would raise the total requirement to 25.82 billion Renewable Identification Numbers for 2026 and 25.98 billion for 2027, up from 22.33 billion in 2025. Foreign biofuels and feedstocks will get half of the credit given to domestic sources, starting in 2028. Refiners have relied on foreign biofuel and feedstock supplies due to insufficient supply in the U.S. 

“Overall, ‘Set 2’ creates a larger, more stable, and more reliable domestic market for U.S. crops, strengthening farm income and rural economies,” EPA Administrator Lee Zeldin said in a statement. “For 20 years, this program has diversified our nation’s energy supply and advanced American energy independence. EPA is proud to deliver on this mission and to do so at historic levels.”

Of course, the program remains a source of conflict between farmers and fuel groups. The American Fuel & Petrochemical Manufacturers President and CEO Chet Thompson in a statement called the EPA’s rule “baffling,” arguing it would result in “all-time records” in compliance costs. 

Read more about the final rule by Maydeen here.

LATEST ON IRAN: Secretary of State Marco Rubio said earlier today that the war in Iran will only last another two to four weeks, according to Axios. 

Rubio’s remarks reportedly came during a meeting with G7 foreign ministers, and marked the first time that a senior administration official had said the war could last longer than the initial 4-6 week timeline originally suggested. 

Sources with direct knowledge of the meeting told the outlet that Rubio said the U.S. would not need G7 members to help reopen the Strait of Hormuz, but would need assistance in keeping control of the waterway. 

“Rubio said that the U.S. will need us in the next phase to escort ships or just to have an international presence in the Strait of Hormuz to show the Iranians they don’t control the strait. Everyone agreed,” the source told Axios.

Plus – another strait at risk: Fears are growing that Iran could target and close another critical shipping lane in the Middle East. Eyes are now on the Bab el-Mandeb Strait, which connects the Red Sea and the Arabian Sea. Roughly 10% of global oil supply travels through the waterway. 

An Iranian military official was recently quoted saying that if the U.S. and Israel escalate their attacks on Iran’s energy infrastructure, Iran would in turn target other straits, including the Bab el-Mandeb Strait. 

WHERE PRICES STAND: Trump attempted to calm the markets yet again yesterday afternoon, extending the pause on attacking Iranian energy facilities for 10 days. The decision, however, did not have as significant an effect on global oil prices as his original decision to delay last Monday did. 

In fact, prices only rose today. 

Just before 3 p.m. EDT, Brent crude was up by 3.91%, selling at $112.23 per barrel. West Texas Intermediate was also up by 5.14% and priced at $99.28 per barrel. 

JAPAN INCREASES COAL POWER TO OFFSET LNG SUPPLIES: Prime Minister Sanae Takaichi of Japan said today that her country will relax restrictions on coal power due to disruptions in the natural gas supply caused by the war in Iran. 

In a social media post, Takaichi said that about 7% of the country’s electricity comes from oil-fired power plants and about 30% from liquefied natural gas power. 

She added that about 6% of LNG imports pass through the Strait of Hormuz, but currently power and gas companies maintain inventories nearly equal to this annual import volume and there are efforts to secure alternative supplies.  

“For this reason, there is currently no disruption to the stable supply of electricity, but to ensure even greater preparedness, we will increase the operation of coal-fired power plants and conserve LNG usage,” Takaichi wrote. 

She added that Japan will not apply operating restrictions to coal-fired power plants in fiscal year 2026 to save about 500,000 tons of LNG consumption yearly. The prime minister added that Japan is working with G7 countries and the International Energy Agency to reduce disruptions in petroleum products in the country. Japan yesterday started to release national stockpiled crude oil. 

‘DRILL, BABY, DRILL’ UPDATE: The tally of U.S. oil and gas rigs tracked by Baker Hughes fell by nine this week, signalling that domestic producers aren’t all that confident in crude price hikes seen this month. 

The details: Data released by Baker Hughes this afternoon revealed the count fell by eight for land rigs by one for offshore rigs. There are four fewer gas rigs and five fewer oil rigs. 

This brings the total count of active rigs in the U.S. to 543, down 49 from this time last year. 

The Baker Hughes data does not include information about drilled but uncompleted wells (DUCs), where oil and gas have yet to be extracted.

Why this matters: All week, the Trump administration has been encouraging domestic oil and gas producers to take advantage of high crude prices and increase production. Industry executives threw cold water on that push, as seen in the Federal Reserve Bank of Dallas’ quarterly survey released Wednesday. 

Many drilling executives anonymously said they were hesitant to pursue new wells as there is so much uncertainty around how long high prices will last. 

“Suppliers are already trying to increase pricing, and the administration continues to try and talk down [oil] prices,” one exploration and production executive said. “How sustainable are current oil prices? Hard to make long-term commitments or to ‘drill, baby, drill.’”

ENERGY DEPARTMENT TO MOVE HEADQUARTERS: The Department of Energy is moving down the road, relocating its headquarters in Washington, D.C. 

The details: The agency announced late yesterday afternoon that it would be moving its headquarters from the James V. Forrestal building to the Lyndon B. Johnson building, less than a mile down the road on Independence Ave. 

DOE’s headquarters has been at the Forrestal building for decades, while the LBJ building has been the home for the Education Department. DOE has said the move will save taxpayers “over $350 million in deferred maintenance and modernization costs.” 

All staff currently working at the Forrestal building will be reassigned to work at LBJ, the agency’s Germantown Campus, the Portals office building, or at 950 L’Enfant, next to the International Spy Museum. 

The move is expected to take place around August. 

MORE DOUBTS ABOUT NET-ZERO BY 2050: Just a few days after striking a deal with the Trump administration to kill two of its offshore wind projects, French energy major TotalEnergies may be rethinking its net-zero by 2050 goals. 

The details: TotalEnergies said in its Sustainability and Climate 2026 Progress Report yesterday that it has had the goal of being fully carbon neutral by the mid-century. Those targets, which are in line with goals for the 2016 Paris Agreement, are stretching further out of reach. 

“We must, however, confront our ambition with reality and acknowledge that our societies have embarked on a transition, but at a pace that does not yet allow for the collective achievement of carbon neutrality as pursued under the Paris Agreement,” TotalEnergies wrote in the report. 

As a result, the company said, it is not in a position to formulate net-zero targets as required under European sustainability and climate-related regulations, including the corporate sustainability reporting directive and associated reporting standards.  

“Without the right policies and enough cost-efficient innovation, carbon neutrality by 2050 will remain out of reach – for society and for TotalEnergies,” the company said. “As a result of these dependencies, the pathways to our carbon neutrality ambition will need to be reassessed and adapted over time.”

Our take: This reassessment from the French energy major could prove crucial for the Trump administration, which is pressuring European allies to abandon their net-zero goals and walk back climate rules and regulations. U.S. officials have lambasted these policies, claiming they will create major barriers to trade between the U.S. and the EU, particularly as the administration looks to increase exports of emissions-intensive goods, including natural gas. 

ICYMI – BYD MOVES INTO CANADA: The Chinese electric vehicle company BYD plans to open 20 car dealerships in Canada, Electrek reported. 

Canada earlier this year slashed 100% tariffs on Chinese EVs to 6.1%, allowing for Chinese EVs to enter the North American market. The company is considering locations in the Greater Toronto Area and plans to expand into Vancouver, Montreal, and Calgary. 

The trade deal struck by Canada and China earlier this year does reduce tariffs on Chinese EVs but places a cap on imports at 49,000 Chinese-made EVs in the first year. The second year would allow for another 24,500 vehicles and the limit would increase to 70,000 cars by 2030. 

RUNDOWN 

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