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OIL FALLS AFTER PUSHED TO FOUR-YEAR HIGHS: Oil prices shot up to the highest level in four years in early trading today, with international benchmark Brent Crude hitting more than $126 a barrel. 

The surge in prices was primarily driven by news that the U.S. military was planning to brief President Donald Trump on military actions that the United States could take against Iran. 

By the time the U.S. markets opened today, though, prices fell back down to around or below the $110 line. Just before 3 p.m., Brent was selling at $110.78 a barrel, while West Texas Intermediate was priced at $105.34 a barrel. 

So, what’s going on? This price drop did not appear to have a direct catalyst, such as a social media post from Trump attempting to jawbone the markets. Instead, analysts attributed the slide to changes in futures contracts. What does that mean? In the last month, markets have been trading oil for June contracts, meaning that the crude is delivered in June. These contracts expire today, with July contracts becoming forward-facing. 

Oil markets are currently in backwardation, meaning near-term contracts are typically priced higher than those further out. And as July contracts have been priced far lower than June, under $110 a barrel, that switch appears to account for the significant shift in price, according to the Wall Street Journal. 

What about gasoline? While oil markets saw some relief today from overnight highs, gasoline prices have once again hit the highest level seen in the last four years. 

On Thursday, AAA reported that the national average price of gasoline was $4.30 a gallon, up nearly $0.30 in just one week. This time last week, the national average sat at $4.031 a gallon. 

Petroleum analysis group GasBuddy also reported this morning that every single state in the U.S. saw an increase in gasoline prices today. 

And even as analysts have sounded the alarm that prices will continue to rise, demand continues to grow, indicating that drivers aren’t willing to change their behaviors just yet. Data released by the Energy Information Administration today shows that gasoline demand rose from 9.05 million barrels a day to 9.10 million last week. Simultaneously, domestic gasoline supply and gasoline production both fell last week. 

Since the war in Iran began, GasBuddy estimates, Americans have spent $21.7 billion more to fill their tanks. 

FARM BILL PASSES, BUT ETHANOL SALES REMAIN IN QUESTION: House lawmakers passed the farm bill this morning, which would reauthorize food and agriculture programs for the next five years. 

While a win for Republicans, the party continues to struggle to pass a plan to allow for the year-round sale of the ethanol blend known as E15. Earlier this week, it was reported that Republicans agreed to allow for the year-round sale of E15, but those representing oil states opposed the plan. 

As part of the effort to pass the farm bill, Republican leaders agreed to decouple the bill and E15. The House will now hold a standalone vote on E15 on May 13. 

Democrat Rep. Angie Craig of Minnesota said on the House floor today, “I would just caution colleagues on the other side of the aisle who believe that there is a deal to get E15 to the floor that there are some antics and tricks related to going back to the Rules Committee that folks may be planning.” 

“Unfortunately, Republican leadership has a history of promising something different to a number of different factions within the Republican Party,” she added. 

Corn growers have pushed for year-round sale of the ethanol blend. But, small refineries have warned that it could be economically challenging to comply with higher ethanol mandates. 

Glyphosate: Meanwhile, the Make America Healthy Again movement also secured a major victory today, as lawmakers stripped out a provision from the farm bill that advocates said would protect chemical companies from liability. 

Lawmakers removed a provision that would have blocked states and courts from penalizing pesticide companies for failing to include health concerns on their labels beyond those recognized by the Environmental Protection Agency. 

“Huge win for states rights and MAHA,” Republican Rep. Thomas Massie of Kentucky wrote in a post on X. “The special provisions for pesticides (and herbicides like glyphosate) was just stripped from the farm bill by an overwhelming majority!”

MAHA advocates have said that chemicals like glyphosate can cause cancer. MAHA has pushed for the administration to regulate the chemical. 

Read more about MAHA’s farm bill victory by Washington Examiner’s Lauren Green here. 

NEW JERSEY WANTS TO WORK WITH THE WHITE HOUSE ON NUCLEAR: New Jersey’s Democratic governor, Mikie Sherrill, is willing to work with the White House on one key energy issue: nuclear power. 

The details: Since taking office, Sherrill has sparred several times with Trump over funding cuts and immigration issues. This week, the governor clarified to NJ.com that she isn’t set out to never work with Trump, particularly when it comes to issues that could help realize her energy agenda. 

“[W]e’re working with the White House because we think that they could put the finance together really well for nuclear,” Sherrill said. “I really think that the federal government’s key if we’re going to build this out at a reasonable cost and in a reasonable timetable.”

This comes just weeks after Sherrill signed a bill lifting the state’s moratorium on new nuclear power projects, which had been in place for half a century. 

A closer look: This wouldn’t be the first time that this administration has worked alongside Democratic governors to boost nuclear energy. Take Pennsylvania, for example, where the administration has supported Democratic Gov. Josh Shapiro’s efforts to expand nuclear power by restarting the Three Mile Island nuclear plant. In December, Energy Secretary Chris Wright visited the project to promote the plant’s restart. 

Read more from the Examiner’s Molly Parks here. 

GM TO INVEST IN GASOLINE CARS: General Motors plans to invest $340 million to boost production of gas-powered vehicles, as the company has moved away from electric cars, Business Insider reported. 

The funding will go toward two facilities in Romulus, Michigan, and Toledo, Ohio, that will build key parts for gasoline cars, including transmission and engine components. 

The Romulus plant will receive $300 million and Toledo will get $40 million. The publication said GM has invested nearly $6 billion in U.S. manufacturing in the last year. 

The move comes as many automakers have shifted their investments away from the production of electric vehicles, following the Trump administration’s termination of tax credits.

A STALEMATE OVER THE GLOBAL CARBON SHIPPING TAX: Little progress has been made on whether the International Maritime Organization will be able to move forward with and vote on its previously approved carbon tax on the global shipping industry later this year. 

If you forgot, the IMO planned to vote on the measure in October to affirm the tax as international law and accelerate a transition to cleaner fuels. The Trump administration torpedoed the effort, convincing enough members to vote in favor of delaying the vote. 

The details: This week, members of the IMO’s Marine Environment Protection Committee have been meeting to revisit elements of the proposal (known as the net-zero framework), and whether it will be scrapped entirely. 

The U.S. has stood firm in that it will not support any proposal that includes a tax on carbon emissions, a position also backed by Saudi Arabia, the United Arab Emirates and several other large fossil fuel exporters. 

These states are broadly in favor of a different proposal known as “Panlibarg” – a reference to the nations that proposed it, Panama, Liberia, and Argentina – which would significantly favor liquefied natural gas. Other proposals include eliminating carbon pricing, weakening fossil fuel phase-outs, and easing emissions targets. 

Many nations are still in favor of keeping the existing proposal, which was approved last spring, including the United Kingdom, Brazil, Australia, Mexico, Colombia, South Africa, Canada, Tuvalu, Kiribati, and several members of the European Union, according to Lloyd’s List. 

Trump administration tactics: Reports indicate that, unlike in October, the U.S. has taken a less aggressive negotiating approach this week. Rather than issuing threats, officials have passed out flyers detailing estimated costs associated with the carbon shipping tax, according to Euractiv, which obtained some flyers. These flyers reportedly claimed the tax would result in annual costs of up to $150 billion.

What’s next: This week’s session will not result in a vote on the measure, as that has been punted to this October. Instead, members have the opportunity this week to put forth proposals that could be included in a potential draft measure that would replace the net-zero framework. 

At the start of the session, IMO Secretary-General Arsenio Dominguez encouraged members to engage in “constructive and pragmatic exchanges” throughout the week. “Listen to one another, there is no need to argue. We are adult enough to agree to disagree,” he said.

Dominguez also berated officials over how October’s session unfolded, when the U.S. threatened sanctions against nations who voted in favor of the framework. “There is no reason to repeat what happened last October,” he said. 

EU TO WEAKEN DEFORESTATION BAN TO EXCLUDE LEATHER: The European Commission is reportedly moving forward with excluding imports of leather from its deforestation ban that was supposed to go into effect this year. 

Officials with the European Union confirmed to Reuters today that the commission will be making the exclusion in response to arguments from the industry that the production of leather does not promote cattle farming that contributes to deforestation. 

The exemption, which will also need to be adopted by the European Parliament, will apply to leather, hides, and skins. 

Quick reminder: The deforestation ban was first approved by the EU in June 2023 and is intended to reduce the number of products consumed in the region that contribute to deforestation, while also reducing carbon emissions. Once in effect, the law will prohibit products made from commodities – such as coffee, palm oil, soy, cocoa, cattle, wood, and rubber – that were imported from recently cleared forests or contributed to forest degradation.

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