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: Environmental Protection Agency Administrator Lee Zeldin engaged in heated exchanges with Democrats this week during congressional hearings on the agency’s budget request, including with Sen. Sheldon Whitehouse of Rhode Island over whether the agency has been tracking the consumer cost of keeping retiring coal plants operating. 

“You think that the math is better for West Virginia, if you close down their coal plants and put these people out of work and tell them to learn how to code?” Zeldin argued. 

The administrator later pushed back further, criticizing Whitehouse’s personal life. “We want to stick to the science. If you don’t agree with them, you don’t follow their logic, then they’ll want to vilify you…and I’m not going to take morality lessons from people who join all-White country clubs,” he said. 

LATEST ON IRAN: President Donald Trump rejected Iran’s latest peace proposal, sent last night, complaining that the country’s leadership is “disjointed.” 

Trump told members of the press earlier today that he was “not happy” with the proposal, the details of which have not yet been made public. He also criticized Iranian negotiators, saying they are disorganized and unable to agree during the ceasefire discussions. 

“One says one thing, one says another. They’re very confused,” Trump said. “Obviously, their country has been frankly decimated. Their navy is gone. Their air force is gone. Many of their soldiers, unfortunately, are gone. They’ve got to come up with the right deal.”

While the White House has yet to agree to a proposal Iran has come up with, administration officials have indicated that each one Tehran sends is better than the last. 

“It’s better than what we thought they were going to submit,” Secretary of State Marco Rubio said earlier in the week. “I think there are still questions about whether the person submitting it had the authority to submit that offer, about whether it’s real – and what it means.”

Back in Washington: Also today, Trump sent letters to Congress informing members that because of the ceasefire, he does not need its authorization for continued military operations in Iran. 

Under the 1973 War Powers Resolution, the president is required to seek congressional authorization for war from Congress after a conflict hits a 60-day threshold. As Trump formally told Congress of the war on March 2, that 60-day mark is today. 

Trump has argued that his ceasefire with Tehran, which started on April 7, stops that 60-day clock. He has also claimed that no other president has ever sought the authorization before. 

“There’s been numerous, many, many times, and nobody’s ever gotten it before. They consider it totally unconstitutional, but we’re always in touch with Congress, but nobody’s ever sought it before,” Trump told reporters this morning. “Nobody’s ever asked for it before. It’s never been used before. Why should we be different?”

HOW PRICES REACTED: News of Iran’s latest peace proposal, coupled with the shifting to July futures contracts as we touched on yesterday, caused oil prices to dip slightly today. 

“This Iran proposal has given ​hope to the market that there is an off-ramp for the United States,” Phil ​Flynn, a senior analyst with Price Futures Group, told Reuters. 

As of around 3 p.m. EDT, both International and domestic benchmarks remained above $100 and had dropped by around 2%. Brent Crude was down by $1.90 and was priced at $108.50 per barrel. West Texas Intermediate dropped by $2.81, selling at $102.26 per barrel. 

OIL PRODUCERS HOLDING OUTPUT PLANS: ExxonMobil and Chevron have indicated they do not plan to adjust their production strategies even though the White House has pushed for increasing output. 

Exxon’s chief financial officer, Neil Hansen, told the Financial Times that there’s “no change” to the company’s strategy in the Permian Basin, a region that accounts for a significant amount of U.S. oil and gas. Similarly, Chevron’s finance chief Eimear Bonner told the publication that the war has not led to any changes in the company’s plans.

The comments come as both oil and gasoline prices reached some of the highest levels since the war in Iran started in February. The White House has long advocated for oil producers to boost output to ease prices, especially now as the conflict in the Middle East has caused an energy crisis. 

Exxon’s Hansen told the Financial Times that there is no need to shift strategy because “we’re already in high gear.”

Meanwhile, Bonner of Chevron told the publication that the company’s strategy is to “grow free cash flow, not grow production.” She added, “You wouldn’t expect us to be changing our plans significantly on the back of eight weeks of disruption.”

Read more by Maydeen here. 

‘DRILL, BABY, DRILL’ UPDATE: Meanwhile, the number of active oil and gas drilling rigs in the United States did actually increase this week. 

Data released by Baker Hughes this afternoon showed that there are three more active rigs than this time last week, bringing the total number to 547. Broken down further, Baker Hughes found that the number of rigs located in inland waters rose by one and the number located offshore rose by eight. For rigs located on land, the number dropped by six, bringing the total number of new rigs to three. 

The number of gas drilling rigs increased by one, as did the number of oil rigs in the U.S. 

OCCIDENTAL’S VICKI HOLLUB STEPPING DOWN: Vicki Hollub, the CEO of Occidental Petroleum and a pioneer for women in the oil and gas industry, is officially stepping down from her role after 10 years. 

Hollub has served as the president and CEO of Occidental since April 2016, when she became the first woman to head a major American oil company. She has worked with the company for more than four decades and will be passing on the role of chief executive to COO Richard Jackson. 

Occidental’s domestic production of crude increased over Hollub’s tenure, in large part thanks to the company’s $55 billion acquisition of Anadarko Petroleum in 2019. The deal stuck Occidental with a large amount of debt, much to the chagrin of many shareholders. 

The company’s stock fell significantly while Hollub was at the helm, dropping by 21% since April 2016, according to Dow Jones Market Data reviewed by Barron’s. Over that same time period, other majors like Chevron and Exxon saw their stocks jump by more than 70%. The war in Iran has caused Occidental’s stocks to rally by nearly 50%, though.

Hollub is expected to stay on as a board member. 

BOOSTING VENEZUELAN OIL PRODUCTION: The Trump administration facilitated the entry of three American oil companies into Venezuela for the first time this week, marking the latest effort from the White House to revitalize the country’s crude industry. 

The details: The White House confirmed to Callie that, yesterday, officials with the National Energy Dominance Council helped Hunt Oil, HKN Energy, and Crossover Energy enter Venezuela. 

White House spokeswoman Taylor Rogers said all three companies signed deals to invest in Venezuela, and increase “oil production by hundreds of thousands of barrels annually, further strengthening the U.S.-Venezuela partnership and economic ties.”

The U.S. delegation was led by National Energy Dominance Council executive director Jarrod Agen. Yesterday, Agen was also spotted meeting with high-ranking Venezuelan officials, including interim president Delcy Rodriguez. 

Other majors interested: Large oil and gas firms have been hesitant to commit significant capital in Venezuela in recent months, due to legal and political risks lingering in the wake of the capture of former dictator Nicolas Maduro. But both the U.S. and Venezuela have taken steps to ease sanctions or change local laws aimed at making it easier for foreign companies to invest. 

That, coupled with surging oil prices brought on by the Iran war, has made the Latin American country an attractive option for future investments for several majors. Both ExxonMobil and ConocoPhillips met with officials and sent technical teams to the country in recent weeks, the Wall Street Journal reported.

Read more from Callie here. 

EPA CLARIFIES OIL WELL FLARING: The Environmental Protection Agency has issued new guidance on routine flaring for new oil wells. 

The Biden administration rules for oil and natural gas producers, known as OOOOb/c, set a May 7 deadline to phase out routine flaring from new oil wells. The EPA said that current regulations will allow producers to continue routine flaring of associated gas at new oil wells in limited situations past the deadline. 

The agency said the clarification is in response to concerns from several oil and natural gas operators about uncontrollable factors that could force production shutdowns. 

In a statement, EPA administrator Lee Zeldin said, “EPA is providing certainty that oil operators and owners already have the flexibility under our regulations to navigate situations beyond their control and continue unleashing American energy. In doing so, the Trump EPA is advancing American energy dominance and lowering energy costs across the nation.”

The EPA earlier this month finalized revisions to certain aspects of the Biden administration’s OOOOb/c rules. The previous administration’s rule would have restricted routine flaring of natural gas from new sources and allow temporary flaring in maintenance situations. 

Temporary flaring is a controlled burning of natural gas at oil and gas sites to release pressure in pipes or tanks during maintenance or emergencies. 

DOE UPDATES RIVIAN LOAN: The electric vehicle company Rivian renegotiated a loan with the Department of Energy to help boost production at its Georgia plant. 

Rivian said that it has updated its loan with the Department of Energy to $4.5 billion, which will help support production. The loan will support one phase of production, with a total capacity of 300,000 cars, according to CNBC. 

The initial $6.57 billion loan was provided during the Biden administration and would support two phases of production for 400,000 vehicles, but the loan was at a standstill under the Trump administration. 

Rivian plans to draw from the loan by early 2027 and the plant is on track to produce vehicles in 2028. 

ICYMI – TRUMP SIGNS PERMIT FOR CANADIAN-U.S. PIPELINE: Trump has signed a permit allowing for the construction of a massive oil pipeline to be built across the U.S.-Canada border, somewhat reviving the controversial Keystone XL pipeline. 

The details: Yesterday, Trump approved the pipeline project, which has been informally dubbed “Keystone Light.” The project is considered to be a scaled-down version of the Keystone XL pipeline, which Trump sought to finish during his first administration and was later terminated under former President Joe Biden. 

The pipeline project, developed by Bridger Pipeline, is expected to stretch roughly 650 miles from Canada through Montana and Wyoming, with an estimated daily capacity of 550,000 barrels of crude. This is about two-thirds of the capacity Keystone XL would have had. 

Read more from the Examiner’s Claire Carter here. 

RUNDOWN 

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