U.S. Demands Unilateral Tariff Cuts From EU

By Tsvetana Paraskova - May 23, 2025

The U.S. Administration wants the EU to make unilateral cuts to its tariffs on American goods and abolish a proposed digital tax for trade negotiations to advance, sources briefed on the U.S. trade negotiators’ latest stance have told the Financial Times.

The U.S. hit the EU with a 20% ‘reciprocal’ tariff in early April, but the Trump Administration later backtracked on the so-called reciprocal tariffs following a major market rout triggered by fears of recession. The United States has now left a baseline 10% tariff on all countries by July 8 as it is engaging in negotiations to secure trade deals. 

The U.S., however, kept the 25% tariff on EU steel, aluminum, and car parts. Washington is also threatening additional tariffs on pharmaceuticals and semiconductors. 

The U.S. is set to communicate to the EU’s trade negotiators on Friday that the bloc should make unilateral concessions and cut tariffs on U.S. goods, instead of seeking mutual cuts to the tariffs, according to FT’s sources. The Trump Administration is also unhappy that the EU’s proposal for negotiations did not include abolishing the proposed digital tax. 

Early last month, the EU proposed mutual zero tariffs. 

European Commission President Ursula von der Leyen said in early April that “Europe is ready to negotiate with the US.”

“We have offered zero-for-zero tariffs for industrial goods. Because we're always ready for a good deal. But we’re also prepared to respond with countermeasures. And protect ourselves against indirect effects through trade diversion,” von der Leyen added.

U.S. President Donald Trump has dismissed the ‘zero-for-zero tariffs’ offer and told reporters in the White House who asked if the EU offer was sufficient to back down on tariffs on the EU, “No, it's not.” 

The U.S. has made one trade deal – with the UK – since backing off tariffs temporarily to start negotiations. A failure in the U.S.-EU trade talks wouldn’t be good for the economies of either party and could dampen the prospects of oil demand growth.  

By Tsvetana Paraskova for Oilprice.com

 

Phillips 66 to Lay Off Most Workers at Los Angeles Refinery

By Tsvetana Paraskova - May 23, 2025

U.S. refining giant Phillips 66, which will close its LA refinery later this year, will lay off in December most of the workers at the plant, Reuters reports, citing sources with knowledge of the plans.  

Last October, Phillips 66 said it would shut down its refinery in the Los Angeles area in the fourth quarter of 2025, due to “market dynamics.”

Approximately 600 employees and 300 contractors currently operate the Los Angeles-area refinery, Phillips 66 said when it announced the closure.

“We understand this decision has an impact on our employees, contractors and the broader community,” Mark Lashier, chairman and CEO of Phillips 66, said in October.    

“We will work to help and support them through this transition.” 

Lashier added that the long-term sustainability of the Los Angeles Refinery is uncertain and affected by market dynamics. 

The reduction of the workforce, to begin in December, will affect most employees, while a few retained workers would be transferred to the Los Angeles marine oil terminal operated by Phillips 66, according to Reuters’s sources. 

A spokesperson for the company told the newswire on Thursday, “Since the announcement was made to idle these facilities, Phillips 66 has stated its commitment to helping employees and contractors through this transition.” 

Phillips 66’s LA refinery will not be the only one to cease operations in California soon. 

Last month, Valero Energy said it plans to idle, restructure, or cease refining operations at its Benicia Refinery in California by the end of April 2026, as one of the biggest U.S. refiners continues to evaluate strategic alternatives for its operations in California. 

The Energy Information Administration (EIA) expects U.S. refinery capacity to be 17.9 million bpd at the end of 2025, about 3% less than at the beginning of this year, with LyondellBasell’s Houston oil refinery closing, and the Los Angeles refinery of Phillips 66 shutting down operations. 

By Tsvetana Paraskova for Oilprice.com

GRIFT

U.S. Courting Asian Investors for $44 Billion Alaska LNG Project

CANADA HAS A DEEP WATER LNG PORT IN PRINCE RUPERT BC

By Tsvetana Paraskova - May 23, 2025

The top U.S. energy officials will host on June 2 an event with officials from South Korea, Japan, and Taiwan to tout the $44-billion Alaska LNG project for which the United States is seeking Asian investors, sources with knowledge of the plans told Reuters on Friday. 

State firm Alaska Gasline Development Corporation (AGDC) seeks to advance the Alaska LNG project, designed to deliver North Slope natural gas to Alaskans and export LNG to U.S. allies across the Pacific.

U.S. officials toured Asia earlier this year in search of potential Asian investors in the LNG project. The LNG export facility is strongly supported by the Trump Administration, which has been also pressing Japan and South Korea to buy more LNG as a way to reduce America’s trade deficit with its Asian allies.

U.S. Secretary of the Interior, Doug Burgum, and Energy Secretary Chris Wright will host the June 2 event in Alaska. However, the visit is unlikely to result in major investment deals for the Alaska LNG project, as it is not clear yet how senior the Asian officials will be, according to Reuters’s sources. 

In March, Taiwan’s state-held oil and gas company CPC Corporation signed a letter of intent to invest in Alaska LNG and buy LNG from the project as part of a move to bolster its gas supply and energy security.  

Despite the commitments to invest in the U.S., including in Alaska LNG, Taiwan was slapped with a now-halted 32% tariff. Taiwan wasn’t spared from one of the highest now-suspended tariffs despite being the only early committed investor in the huge Alaska LNG project, while Japan and South Korea are hesitating. 

Taiwan is so far the only Asian country to have committed investments and backing to the Alaska LNG project despite the state of Alaska and the Trump Administration’s weeks-long courting of investors from north Asia, such as Japan and South Korea. 

By Tsvetana Paraskova for Oilprice.com

 

Trump Slams UK’s North Sea Energy Policy, Again

By Tsvetana Paraskova - May 23, 2025

U.S. President Donald Trump has taken to social media to criticize once again the UK’s energy policy to pursue renewables and tax North Sea oil and gas operators more.

Referring to the UK, President Trump posted on Truth Social,

“I strongly recommend to them, however, that in order to get their Energy Costs down, they stop with the costly and unsightly windmills, and incentivize modernized drilling in the North Sea, where large amounts of oil lay waiting to be taken.”

“A century of drilling left, with Aberdeen as the hub. The old fashioned tax system disincentivizes drilling, rather than the opposite. U.K.’s Energy Costs would go WAY DOWN, and fast!” President Trump wrote on Friday on the social media platform.

This isn’t the first time President Trump has criticized the energy policy of the United Kingdom.

Early this year, ahead of his inauguration, Trump weighed in on the UK’s energy policy to hike the windfall tax on North Sea oil and gas operators and become a clean energy superpower by boosting offshore wind development.

Trump called for opening up the UK North Sea to oil and gas and getting rid of windmills in response to an announcement by Texas-based Apache that it would cease oil and gas production in the region due to the uneconomical windfall tax.

“The U.K. is making a very big mistake. Open up the North Sea. Get rid of Windmills!” President-elect Trump posted in early January on Truth Social.

The post contained an attached article about Apache’s recent announcement that it would exit the UK North Sea.

In recent weeks, the UK’s clean energy targets came under scrutiny after SSE, a major energy company and renewable projects developer in the UK, said it is reducing spending on renewables in its five-year plan to 2027 by $2 billion (£1.5 billion) “in a changing macro environment.”

The warning from SSE came weeks after Orsted, the world’s biggest offshore wind project developer, announced it had decided to discontinue the development of the Hornsea 4 offshore wind project in the UK in its current form, due to “adverse macroeconomic developments, continued supply chain challenges, and increased execution, market and operational risks.”

By Tsvetana Paraskova for Oilprice.com

 

U.S. Oil Rig Count Plunges Amid Scary Price Environment

By Julianne Geiger - May 23, 2025,

The total number of active drilling rigs for oil and gas in the United States came crashing down this week, according to new data that Baker Hughes published on Friday, following a 6-rig decrease last week.

The total rig count in the US fell by 10 to 566 rigs, according to Baker Hughes, down 34 from this same time last year.

The number of oil rigs fell by 8 to 465 after falling by 1 during the previous week—and down by 32 compared to this time last year. The number of gas rigs slipped by 2 this week, to 98 for a loss of 1 active gas rigs from this time last year. The miscellaneous rig count stayed the same at 3.

The latest EIA data showed that weekly U.S. crude oil production rose, from 13.387 million bpd to 13.392 million bpd. The figure is 239,000 bpd down from the all-time high reached during the week of December 6, 2024.

Primary Vision’s Frac Spread Count, an estimate of the number of crews completing wells, fell again during the week of May 16, this time to 193, compared to 195 in the week prior. The count is now 22 below where it was on March 21.

WTI is trading up on the day, but still well below what the Dallas Fed Survey says is the breakeven for Permian players, with drilling activity in the basin falling by 3 for a second week in a row, to 279—a figure that is 33 fewer than this same time last year. The count in the Eagle Ford fell by 4, to 42 active rigs. Rigs in the Eagle Ford are 8 below where they were this time last year.

At 12:30 p.m., ET, the WTI benchmark was trading up $0.20 per barrel (+0.33%) on the day at $61.40, and down more than $1 per barrel from last Friday’s price. The Brent benchmark was trading up $0.19 (+0.29%) on the day at $64.63— down roughly $0.80 per barrel from last Friday.

By Julianne Geiger for Oilprice.com

$53 Billion Guyana Oil Clash Heads to London Tribunal

By Julianne Geiger - May 23, 2025

• Chevron’s $53 billion bid for Hess faces arbitration as ExxonMobil and CNOOC claim a contractual right to block the deal.

• The outcome is pivotal for Chevron, which urgently needs Hess’s Guyana assets to reverse its declining reserves.

• A tribunal ruling is expected by Q3 and could shift the geopolitical balance of oil power in the Western Hemisphere.

A high-stakes arbitration kicks off Monday in London that could make or break Chevron’s $53 billion bid to acquire Hess Corp—and with it, a coveted 30% stake in Guyana’s booming Stabroek Block. ExxonMobil and CNOOC, Hess’s partners in the block, claim they have a right of first refusal on that stake, arguing the Chevron-Hess deal triggers the clause. But Chevron and Hess counter that the right doesn’t apply to full corporate mergers. The outcome rests on contractual fine print, but the implications are massive: Guyana’s Stabroek Block holds over 11 billion barrels of oil equivalent, and output is projected to double by 2030.

For Chevron, this is a make-or-break moment. The company’s reserves replacement ratio (RRR) hit -4% last year, its lowest in a decade. It desperately needs Hess’s Guyana asset to boost its RRR and plug a growing gap in its portfolio. CEO Mike Wirth has already poured over $3 billion into Hess stock and positioned the company to close the deal quickly—if it wins. If not, Chevron walks away, leaving Exxon and CNOOC free to increase their control over one of the world’s hottest oil plays.

The arbitration, led by the International Chamber of Commerce, is expected to move faster than typical, with a ruling anticipated by Q3. Traders are betting big on a Chevron win—about $10 billion worth of Hess shares have been scooped up by merger-arb funds expecting the deal to close, according to Morgan Stanley’s head of Special Situations, Matthew Mitchell, and cited by Bloomberg.

The outcome hinges on the tribunal’s interpretation of a joint operating agreement drafted more than a decade ago.

If Chevron loses, the consequences will ripple far beyond one failed deal, with Exxon largely expected to consolidate its dominance in Guyana. Chevron, meanwhile, would be left scrambling for another big-ticket asset to shore up its future. The tribunal’s ruling could redefine the balance of power in the Western Hemisphere’s most promising oil basin.

By Julianne Geiger for Oilprice.com

Suriname Votes for President Who Will Oversee Newly-Found Oil Wealth

By Charles Kennedy - May 23, 2025

Suriname, the South American nation hoping to replicate Guyana’s oil boom, is voting on Sunday in presidential and general elections to decide who will oversee energy and oil policy in the country over the next five years.

Suriname, a former Dutch colony which gained independence in 1975, has a population of just over 600,000 residents who will choose among five presidential candidates in the May 25 election.

Incumbent President Chan Santokhi seeks a second five-year presidential term against four other contenders. The president’s biggest rival appears to be Jennifer Geerlings-Simons, the leader of the left-leaning National Democratic Party.

Both frontrunners are encouraging more drilling in Suriname’s offshore basin to find more oil and are open to welcoming major international companies to develop projects in the country.

Suriname has been seeing increased investment and exploration in its oil and gas sector, driven by the success of neighboring Guyana and major projects like GranMorgu.

Shell, TotalEnergies, and Petronas are leading exploration efforts offshore Suriname, hoping that the oil treasure trove in neighboring Guyana extends into Surinamese waters.

Oil volumes have been found, and French supermajor TotalEnergies is developing GranMorgu, a $10.5-billion oil project offshore Suriname.

In October, TotalEnergies announced the final investment decision for the GranMorgu development of the fields off the coast of Suriname, which are estimated to hold recoverable reserves of more than 750 million barrels.

First oil is expected in 2028.

The project includes a 220,000 barrels of oil per day Floating Production Storage and Offloading (FPSO) unit.

In 2028, when the project is expected to come on stream, Suriname’s GDP will jump by as much as 55%, the International Monetary Fund (IMF) has predicted.

“In the long term, the oil reserves are not as large as that of Guyana, though Suriname is able to ramp up production rapidly,” the IMF said.

By Charles Kennedy for Oilprice.com

Nornickel says board recommends no dividends for 2024

Reuters | May 22, 2025 | 

Sign at Nornickel HQ. (Image courtesy of the Nornickel Facebook page)

Russia’s Nornickel, one of the world’s largest producers of nickel and the largest producer of palladium, said on Thursday that its board recommended not to pay dividends for 2024.

The company said the decision was “made in order to maintain financial stability”.

(By Anastasia Lyrchikova and Gleb Bryanski; Editing by Kirsten Donovan)

Poland to cut copper mining tax from 2026, finance minister says

Reuters | May 23, 2025 | 

Głogów Copper Smelter and refinery – Image courtesy of KGHM

Poland’s copper mining tax will fall from next year under a new system that will provide deductions related to investment spending, Polish finance minister Andrzej Domanski said on Friday.


The tax on mineral extraction, including copper, was introduced in 2012. Poland’s biggest copper miner KGHM paid 3.87 billion zlotys in tax in 2024, according to its annual report.

Domanski said the tax cut and the introduction of investment spending deductions would lower tax revenues by an estimated 10 billion zlotys ($2.66 billion) over ten years and reduce costs for copper producers by the same amount.

“The fact that KGHM is a supplier of about 85% of copper in Europe is absolutely crucial,” minister of state assets Jakub Jaworowski said.

“By taking care of investments in Poland, by taking care of the development of KGHM, we also take care of the collective security of the West and the European Union.”

($1 = 3.7545 zlotys)

(By Karol Badohal and Pawel Florkiewicz; Editing by Jane Merriman)

Column: US aluminum smelters vie with Big Tech for scarce power

Reuters | May 23, 2025 | 

Aluminum processing facility. Stock image.

It’s forty-five years since anyone built a primary aluminum smelter in the United States.


When Alumax fired up the Mt Holly plant in South Carolina in 1980, the country’s tally of smelters rose to 33 with combined annual capacity of almost five million metric tons of aluminum.

Today that number has shrunk to six. Two are fully curtailed. Two, including Mt Holly, are running below capacity. Annual production has shrunk to 700,000 tons.

Emirates Global Aluminium hopes to reverse the tide with a new plant in Oklahoma. It joins Century Aluminum, which was awarded federal funding by the Joe Biden administration for a new “green” low-carbon smelter somewhere in the Ohio/Mississippi River Basins.

Both projects face the same dilemma. High power prices killed off most of the country’s smelters and a lack of competitively priced power has deterred anyone from building one since the last century.

It doesn’t help that any smelter project must compete for electricity with tech companies willing to pay almost anything for their power-hungry data centres.

No power, no metal

Aluminum compounds have been around since ancient times, used by the Egyptians as a dye-fixer and the Persians for pottery.

But it wasn’t until the early 19th century that anyone worked out how to refine bauxite into metal and even then it remained something of an expensive curiosity. Global production was just two tons in 1869 and aluminum was more valuable than gold.

The solution, discovered independently by Charles Martin Hall in the United States and Paul Héroult in France, was to use electrolysis on an intermediate product called alumina.

The Hall-Héroult process is still the dominant technology in producing a metal that is now ubiquitous in buildings, vehicles and consumer packaging. And it needs a lot of uninterrupted power.

It takes 14,821 kilowatt-hours of electricity to make a ton of aluminum, according to the US Aluminum Association. A modern-size smelter with annual capacity of 750,000 tons needs more power than a city the size of Boston.

That’s a big challenge for any primary aluminum producer in the United States given the Energy Information Administration estimates that the country will be facing an energy deficit of 31 million megawatt-hours by 2030 and 48 million by 2035.


Aluminum versus AI

The power is available right now to build a new US aluminum smelter, according to Matt Aboud, senior vice president of strategy & business development at Century Aluminum.

The problem, he explained at last week’s CRU Aluminium Conference in London, is that it isn’t available at a fixed long-term price, which is what a smelter needs to lock in its profitability and pay back construction costs that will run into the billions of dollars.

The Aluminum Association estimates that a new US smelter would need a minimum 20-year power contract at a price of not more than $40 per MWh to be viable at current aluminum prices.

Any smelter project is in a race with Big Tech, which is on the same hunt for energy to power its next-generation artificial intelligence data centres.

And tech companies “have no limit on what they are prepared to pay for dependable 24/7 electricity”, according to the Aluminum Association’s just-released report on rebuilding US supply chain resilience.

The Association estimates Microsoft conceded $115 per MWh in its deal with Constellation Energy to restart the Three Mile Island nuclear plant in Pennsylvania.

Even reactivating moth-balled aluminum lines will be challenging given the 2023 price of power averaged $73.42 per MWh in the four US states hosting smelters with idle capacity, it warned.

‘Where the wind comes sweeping down the plain’

EGA hasn’t yet signed a power deal for its proposed 600,000-ton-per-year smelter in Oklahoma. Final go-ahead is contingent on an agreed “power solution framework based on a special rate offer from the Public Service Company of Oklahoma,” according to the memorandum of understanding signed by state governor Kevin Stitt.

Oklahoma has the advantage of producing almost three times more energy than it consumes, according to the EIA.

Around half of the state’s electricity generation was sourced from natural gas in 2023, with wind power accounting for another 42%. Indeed, Oklahoma is the third largest wind power state after Texas and Iowa.

Harnessing intermittent wind power to run an aluminum smelter, however, would take a massive amount of grid storage capacity, meaning there would likely have to be some gas in the energy mix for any new smelter.

That’s better than coal but not ideal in an industry which is collectively trying to lower its carbon footprint to produce “green” aluminum.

Don’t chuck it!

Even assuming EGA can get a viable long-term power deal, the $4 billion project will only pour its first hot metal some time near the end of the decade.

By which time, 14 new re-melt facilities will have started up, lifting US demand for recyclable scrap aluminum to 6.5 million tons, according to the Aluminum Association’s projections.

Recycling requires much less power, typically around 5% of that required to produce virgin metal, and comes at a much lower capital cost.

The main constraint on US secondary production growth is a shortage of “scrap”.

The country has an astonishingly low beverage can recycling rate of just 43% and throws away the equivalent of 800,000 tons of aluminum every year.

It also exports huge amounts of end-of-life aluminum scrap. Exports rose by 17% year-on-year to 2.4 million tons in 2024, much of it destined for China, which is increasingly hungry for recyclable raw material.

Capturing more recyclable material at home and sending less of it abroad would be a complementary strategy for reducing import dependency of a metal classified as critical by every US government agency.

It’s also likely to be faster and cheaper than waiting to see if either EGA or Century can win the battle with Big Tech for enough power to build a new primary smelter.

(The opinions expressed here are those of the author, Andy Home, a columnist for Reuters.)

(Editing by Mark Potter)