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S&P Global — 27 January 2025
By Nathan Hunt
Start every business day with our analyses of the most pressing developments affecting markets today, alongside a curated selection of our latest and most important insights on the global economy
Within hours of being sworn in Jan. 20, President Donald Trump issued an executive order declaring an energy emergency. Trump’s executive orders have affected almost every aspect of energy and climate policy, including LNG, coal, oil, critical minerals, mining, offshore drilling and onshore wind, emissions targets, the Inflation Reduction Act, electric vehicles, tariffs on foreign oil, biofuels and the Paris Agreement on climate change. The policy changes will reshape energy use and environmental policy in the US for years to come.
"The energy and critical minerals ... identification, leasing, development, production, transportation, refining, and generation capacity of the United States are all far too inadequate to meet our Nation's needs," the order said, declaring energy prices an "active threat to the American people."
Trump reversed a number of executive orders issued during former President Biden’s final months in office. The new president reversed a policy that limited new oil and gas leases in Alaska, revoked orders that protected 16 million acres of offshore and onshore acreage, and revoked a January order that Biden signed to restrict oil and gas drilling across 625 million acres of US coastal waters.
Some of the new Trump policies appeared to reflect contradictory agendas. For example, Trump reversed Biden’s actions that blocked the Keystone Pipeline, which is intended to boost deliveries of Canadian crude to the US. But Trump also intends to implement 25% tariffs on all imports from Canada and Mexico, which would make it almost impossible for Canadian oil producers to compete on price with medium-heavy barrels from the Gulf Coast.
Trump also moved quickly to reverse the pause on new LNG export facilities and to encourage further US LNG production and capacity. This move was greeted with some relief from Asian countries that have a growing appetite for LNG imports. According to S&P Global Commodity Insights, LNG demand from Bangladesh, China, India, Indonesia, Malaysia, Myanmar, Pakistan, the Philippines, Singapore, Sri Lanka, Thailand, Vietnam and Australia is expected to reach over 400 million metric tons by 2050.
Trump additionally introduced measures aimed at supporting domestic metals mining production by eliminating some environmental reviews and restrictions. He revoked multiple environmental policies established by previous presidents going back to Jimmy Carter and froze the disbursement of further funds under the Inflation Reduction Act, which was designed to build a domestic renewable energy industry. Trump also began withdrawing the US from the Paris climate accord, as promised prior to the election.
One point of agreement between the energy policies of Trump and Biden affects biofuel producers in the Midwest. Biden had issued emergency waivers permitting the sale of 15% ethanol biofuels in each of the past three summers. Trump has indicated that he will continue to grant waivers, a policy reversal for Republicans that has pleased biofuel and ethanol industry trade groups.
Today is Monday, January 27, 2025, and here is today’s essential intelligence.
A survey that S&P Global Sustainable1 conducted shows that companies across sectors and geographies are contemplating the applications of AI with respect to sustainability. Survey respondents were particularly bullish about the opportunities AI presents to their environmental strategies, pointing to AI’s potential in areas like optimizing energy use, improving resource efficiency, monitoring emissions and reducing waste.
—Read the article from S&P Global Sustainable1
Central banks in Asia-Pacific will have less room to ease monetary policy as the US Federal Reserve is expected to reduce the pace of rate cuts following US President Donald Trump's stated intent to impose higher tariffs. Potentially higher tariffs can create inflationary pressures in the US economy and push the Fed to slow its easing cycle that started in July 2024. Analysts believe India and Australia may start cutting rates only in the second quarter, while the Bank of Japan may announce its third rate increase this week since it ended its negative interest rates policy in March 2024.
—Read the article from S&P Global Market Intelligence
S&P Global Ratings expects Saudi issuers to continue tapping the global and the local capital markets to finance Saudi Vision 2030. While this appears manageable in the short term, it is keeping an eye on the leverage build-up in the medium-to-long term. S&P Global Ratings still expects leverage to remain manageable in its base-case scenario, with private-sector debt to GDP staying below the 100% mark in the next 12-24 months.
—Read the article from S&P Global Ratings
In one of the first instances of an oil tanker transporting Southeast Asia-bound crude through the Suez Canal following the Israel-Hamas ceasefire agreement, trade is gradually picking up, according to S&P Global Commodities at Sea and market participants Jan. 23. The restoration of normal shipments through the Suez Canal is expected to happen sooner rather than later. At least one tanker has already passed through with Singapore-bound crude, and market participants said this will soon become a more frequent trend.
—Read the article from S&P Global Commodity Insights
As Donald Trump returns to office, the landscape of natural gas in the US — and LNG in particular — is expected to shift both domestically and globally. S&P Global gas market experts Laurent Ruseckas and Matthew Palmer join EnergyCents with hosts Hill Vaden and Sam Humphreys to discuss the top trends that will shape global gas markets in 2025.
—Listen and subscribe to the podcast from S&P Global Commodity Insights
Private equity and venture capital investments in generative artificial intelligence startups are getting bigger and more targeted as investors' strategies evolve with the technology. Funding in GenAI exceeded $56 billion in 2024, according to data from S&P Global Market Intelligence. That was up almost double from 2023, when GenAI companies attracted approximately $29 billion.
—Read the article from S&P Global Market Intelligence
Please join S&P Global Ratings technology sector analysts for a live interactive webinar when they will provide their views on 2025 industry credit outlook.
—Register for the webinar from S&P Global Ratings