WHAT’S HAPPENING TODAY: Good afternoon and Happy Halloween, readers! It’s hard to believe that another month has come and gone so quickly, with the end of the year inching closer in sight.
In today’s newsletter: Treasury Secretary Scott Bessent is laying out a bold timeline for the United States to end its reliance on Chinese rare earths. His comments come just one day after President Donald Trump and Chinese President Xi Jinping reached a truce over China’s rare earth export controls.
Meanwhile, we also provide some updates on Exxon Mobil’s and Chevron’s production, along with the latest numbers on domestic oil and gas drillers.
Have a fun and safe Halloween!
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: The Trump administration has been offering up Alaska and its energy resources in recent trade negotiations with allies in Asia, with many of the discussions hinging on a long-awaited liquefied natural gas pipeline to be built. At least one LNG analyst is doubtful it ever will be.
“The idea of the Alaska LNG project being built still remains…unlikely, because there’s so many other LNG projects in the world that make so much more sense, commercially,” Ira Joseph, a senior research associate at the Center on Global Energy Policy at Columbia University, told Daily on Energy. “As I’ve always said, if this project made sense, it would have been built 40 years ago.”
BESSENT SETS BOLD TIMELINE TO END U.S. RELIANCE ON CHINESE RARE EARTHS: Treasury Secretary Scott Bessent said the United States could end its reliance on Chinese rare earths within two years.
Bessent’s comments occur just one day after President Donald Trump met with Chinese President Xi Jinping, where the two agreed to a truce that involved China pausing its recent export restrictions on five rare earth elements and related technologies.
The secretary told the Financial Times that the two leaders reached an “equilibrium,” but noted that soon China would no longer be able to use critical minerals as a tool for leverage.
“I don’t think they’re able to do it now because we have offsetting measures,” Bessent told the publication, adding that the U.S. would be able to find alternative supplies of rare earths in no more than 12 to 24 months.
It has often been suggested that producing rare earth elements domestically could take a decade or longer, due to the lengthy permitting process.
“China has alerted everyone to the danger. They’ve made a real mistake,” Bessent added. “It’s one thing to put the gun on the table. It’s another thing to fire shots in the air.”
As a reminder: China agreed to pause its recent export restrictions for one year. The restriction required companies to gain permission from the Chinese Ministry to export rare earths or related technologies.
But, the truce between Trump and Xi did not address previous restrictions, where China suspended the exports of seven other types of rare earth metal and magnets.
Bessent said he expects the deal to be signed in the next couple of weeks.
Read more on what Bessent had to say about Trump’s trip to Asia here.
EXXON AND CHEVRON BOOST PRODUCTION OUTPUT: Exxon Mobil and Chevron have increased their output in the third quarter despite forecasts of oil prices set to decline.
Exxon said in its third-quarter report that it achieved another production record of nearly 1.7 million oil-equivalent barrels per day in the Permian Basin. The company reported exceeding 700,000 barrels per day at its operations in Guyana.
Chevron said it had record production of 4.1 million barrels of oil per day in the third quarter, 21% higher than in the same quarter last year.
Both oil companies also reported declines in earnings. Exxon said it earned $7.55 billion, or $1.76 per share, compared to this time last year, when it earned $8.61 billion, or $1.92 per share. Chevron’s earnings in the third quarter were $3.6 billion, or $1.85 per share, which is down 21% from last year.
The Energy Information Administration anticipates that the price of Brent crude oil will average $62 per barrel in the fourth quarter of 2025 and drop to $52 per barrel in 2026.
Read more by Maydeen here.
‘DRILL, BABY, DRILL’ UPDATE: After a couple of weeks of relief, domestic oil and gas drillers saw the number of active rigs in the U.S. drop again this week.
The details: Baker Hughes reported this afternoon that there are four fewer active rigs in the U.S. than last week – and 39 fewer than this time last year. Broken down further, the weekly loss was made up of two land-based rigs and two offshore rigs.
While the natural gas sector actually added four new rigs, the overall industry lost six oil rigs and two additional miscellaneous rigs, creating the four lost. In total, there are roughly 546 active rigs in the U.S. as of today.
Where prices stand: While the price of oil was up this afternoon from yesterday, both international and domestic benchmarks were headed for weekly losses and third consecutive monthly declines.
Right around 2 p.m. EST, Brent Crude was up by just 0.06% and selling at $65.06 per barrel. West Texas Intermediate also increased by 0.34% and was priced at $60.91 per barrel.
ILLINOIS LAWMAKERS PASS BILL LIFTING LARGE-NUCLEAR BAN: The Illinois legislature has passed a bill that would lift the state’s longstanding ban on new large-scale nuclear power plants.
The details: Yesterday evening, state lawmakers approved Senate Bill 25, also known as the Clean and Reliable Grid Affordability Act. The sweeping piece of energy legislation has been debated and negotiated for more than a year and will offer new subsidies for energy storage projects including battery installations, according to Capital News Illinois.
These subsidies mirror current state incentives for renewable energy projects, and are supported by a new charge for ratepayers to offset the costs. While critics say this will be a guaranteed rate increase for consumers, proponents argue that the installation of new energy storage systems will ultimately result in lower electricity bills.
One measure included in the bill that reportedly received substantial bipartisan support was to lift the state’s moratorium on constructing new nuclear power plants. This comes just two years after Illinois partially lifted its ban to allow for the construction of small modular reactors.
Gov. J.B. Pritzker has pledged to sign the bill.
EU ON COURSE TO PHASE OUT RUSSIAN GAS: Turkish state-run media is now reporting that the European Union is on track to phase out Russian gas imports by the 2028 target.
Tatiana Mindekova, a policy advisor on European energy with energy think tank Ember, confirmed with Anadolu Agency this week that the bloc has made substantial progress toward completely ending Russian energy imports. Mindekova said that, in 2021, Russia made up around 40-45% of Europe’s supply of gas. By the end of last year, the bloc had successfully slashed that below 20%.
The EU is aiming to phase out Russian oil fully by 2028, a plan that faces opposition from EU members Hungary and Slovakia, the primary European countries still importing large amounts of fossil fuels from Moscow.
Potential delays: Mindekova pointed to this divergence within the EU as one reason the phase-out could be delayed. She also warned that liquefied natural gas imports from Russia continue to rise, with volumes up by 29% in September. Another potential cause for delay stems from Russia’s shadow fleet of tankers that continue to allow Russian gas to enter EU markets. Additionally, Mindekova warned of new LNG terminals or pipelines that would increase reliance on Russian imports, as well as market volatility.
The U.S. view: The Trump administration is eager for the EU to accelerate this phase-out of Russian gas, to further open the door for U.S. producers to increase exports to Europe. Last month, Energy Secretary Chris Wright urged European allies to further cut off Russian imports as a way to reduce Moscow’s energy revenues that have gone on to fund the war in Ukraine.
“If the Europeans drew a line and said: ‘We’re not going to buy more Russian gas, we’re not going to buy Russian oil.’ Would that have a positive influence on the U.S. leaning in more aggressively [on sanctions] as well? Absolutely,” Wright said at the time.
MORE EU DIVISION…BUT ON CLIMATE GOALS: The European Union is reportedly still split over new emissions reductions targets for 2040 that it had hoped to bring to the U.N.’s Climate Change Conference (COP30) in Brazil next month.
The details: A new Reuters report reveals that the EU may fail to come to an agreement ahead of COP30, where the bloc has hoped to lead in tackling climate change. One diplomat told the outlet that the EU was “walking a knife’s edge” when it came to forming an agreement.
The biggest point of contention in the ongoing debates is reportedly revolving around the use of foreign carbon credits from developing countries to help EU member states hit the 2040 targets. Some nations, like Germany and France, have called for these credits to cover 3-5% of emissions cuts. Others, such as Poland, would like a larger percentage, while some states like Denmark have expressed interest in not allowing the use of foreign credits at all.
The most recent draft proposal obtained by Reuters reportedly showed there was no agreement on the foreign credit offset percentage.
ICYMI – SHELL PULLS OUT OF OFFSHORE WIND PROJECT: Oil and gas major Shell has officially ended its involvement in an offshore wind project that had been set to be built off the coast of New Jersey but was canceled over the summer.
The Atlantic Shores offshore wind project was first launched as a joint venture between EDF Renewables and Shell. The project faced hurdle after hurdle this year, with Shell initially announcing in February that it would be pausing its involvement.
The New Jersey Board of Public Utilities then decided it would cancel the state’s fourth offshore wind solicitation, which would have allowed offshore wind developers to offer up proposals to deliver offshore wind energy to the state in exchange for financial backing.
By June of this year, top executives with the project said they would terminate its renewable energy credits and release it from all associated obligations. Atlantic Shores Offshore Wind Chief Executive Officer Joris Veldhoven described the move as the “closing of a chapter,” but insisted it was not the end for Atlantic Shores. At the time, the project blamed the president’s crackdown on the offshore wind industry as the reason behind its cancellation.
Shell formally withdrew from the project this week, assigning its 50% membership interests to EDF Renewables.
“This decision was taken in line with Shell’s power strategy, where we continue to maximize the value of our platforms and high-grade our portfolio, shifting away from capital-intensive generation projects to assets that support our trading and retail strengths,” Shell said in a press release.
RUNDOWN
E&E News Documentary explores missed chance for US climate policy
The Guardian Harrison Ford says Trump’s assault on climate policy ‘scares the shit out of me’
Associated Press Fast chargers are expanding quickly, but American EV drivers still fear running out of juice
