Good morning and Happy Mother's Day to all the moms out there — especially my own!
Situational awareness: Daimler announces Ambition2039 — a plan to have carbon-neutral new passenger car fleet in 20 years.
My latest column peeks inside the minds of America's swing voters when it comes to climate change and energy. I'll share that, and then Ben Geman will get you up to speed on the rest of the news. You'll also be hearing from me the rest of the week as Ben is taking some well-deserved time off.
1 big thing: Swing voters on climate and energy
Swing voters in 3 of America’s top battleground states discussed what was on their mind when it comes to climate and energy via focus groups: They want President Trump to do more on climate change, think the weather is getting weirder, and don’t know much about the Green New Deal.
Why it matters: It’s voters like these who have an important role electing America’s presidents. So it's worth listening to them.
Details: I watched the focus groups of swing voters, roughly a dozen each in Wisconsin, Ohio and Iowa, who answered questions about political topics, including climate and energy.
- The focus groups were conducted by the nonpartisan research firms Engagious and Focus Pointe Global.
- For the participants: Across the last 2 presidential cycles, roughly half voted for Republican Mitt Romney in 2012 and then flipped to Democrat Hillary Clinton in 2016. The other half went for Democrat Barack Obama in 2012 and Republican Donald Trump in 2016. The Iowa focus group had only Obama-Trump voters.
Some of the key takeaways when it comes to climate and energy are...
1. Current administration: There was widespread agreement with the statement that Trump should do more on clean energy innovation to reduce carbon emissions.
- On a scale of zero to 10 (zero being don't agree at all and 10 being strongly agree), most voters ranked this around a 7 or higher.
2. Weather trends: There was general agreement with the statement that the weather is getting weirder, and some connected it to climate change.
- On the 1–10 scale of agreeability, most voters ranked this a 6 or higher.
3. GND and other policies: The vast majority of these voters don’t know much about the GND, a sweeping proposal calling for drastic reductions in greenhouse gas emissions alongside broader economic goals, like federal jobs guarantees and universal health care.
- Voters were also mixed about whether they would support relatively small increases in electricity costs to address climate change.
The bottom line: Energy and climate change seem to be rising in the minds of America’s swing voters, but the extent of concern appears less intense than many might otherwise assume if you just watch Twitter or cable news.
Go deeper: See comments and interviews from the voters by reading my whole column.
2. Breaking: Saudi tanker attack sends crude prices higher
Crude oil prices rose Monday after Saudi state media said 2 oil tankers sustained "significant damage" in sabotage attacks Sunday near the coast of Fujairah in the United Arab Emirates.
The latest: Brent crude was priced around $72.06 and WTI at $62.77 in trading this morning.
What they're saying: "With a threat to the free circulation of oil in one of the world’s most critical areas, it’s no surprise oil is moving,” BNP Paribas analyst Harry Tchilinguirian tells the Wall Street Journal.
- And UBS Group AG analyst Giovanni Staunovo tells Bloomberg: “The oil market is reacting very sensitively to supply disruption risks considering the market is already tight.”
Go deeper: Axios' Rebecca Falconer has more.
3. Making sense of Biden's climate kerfuffle
A lot has happened in climate politics since our last edition.
Catch up fast: On Friday, Reuters broke the news that Democratic White House frontrunner Joe Biden is crafting a middle ground approach on climate policy.
Why it matters: The story sheds light on how Biden may approach a topic that he has not yet emphasized in his nascent run.
- Biden drew quick attacks from rivals and activists, with Sen. Bernie Sanders and Gov. Jay Inslee issuing statements calling it inadequate. Per HuffPost, Sen. Kirsten Gillibrand was also critical.
The intrigue: Biden's campaign pushed back against the story's framing without disputing their actual reporting. A spokesperson said via Twitter that Biden will address climate in a "meaningful and lasting way."
Here are a few takeaways...
- Biden's approach seems less ambitious than what we've seen from several other candidates, who are backing the GND, and/or promoting aggressive proposals of their own. As we noted in late April, Biden probably has little incentive to run left on climate.
- But, but, but: There's plenty we still don't know. And the Reuters' piece itself cautioned that the approach could change. I know it's lame when journalists say "stay tuned." But stay tuned.
- The way the whole thing blew up and attacks from some other candidates show that climate is a real thing in national politics now.
- Plus, if Biden wins the White House, congressional Republicans and litigation will probably be bigger checks on aggressive measures than any lack of ambition from Biden himself.
The big picture: Per Reuters, the policy will likely include...
- Staying in the Paris climate deal and preserving Obama-era emissions and vehicle mileage rules that Trump is unwinding.
- Being "supportive of nuclear energy and fossil fuel options like natural gas and carbon capture technology," according to one source.
What's next: Via Twitter, Biden said he views climate change as an "existential threat," and that he will unveil more details "in the coming weeks."
4. Big this week: IEA, GND, Congress, Trump
Markets: The International Energy Agency will release its latest monthly oil market report on Wednesday.
- Why it matters: The closely watched IEA report will be the Paris-based agency's first since the U.S. announced that it was ending sanctions waivers for buyers of Iranian oil.
- Market watchers will also be paying attention later today when the U.S. Energy Information Administration releases its latest monthly snapshot of shale production, and tomorrow when OPEC releases monthly output data.
Green New Deal: Rep. Alexandria Ocasio-Cortez and Sanders headline a rally for the sweeping climate and economic template this evening at Howard University in Washington, D.C.
- What's next: The Sunrise Movement, the lefty advocacy group that organized the event, said they will "announce a nationwide campaign to make the 2020 election a referendum on the Green New Deal, with a major demonstration at the second Presidential debate in Detroit."
Congress: This week's spate of hearings includes...
- A Senate Energy and Natural Resources Committee hearing tomorrow on bills to boost development of critical and rare earth minerals used in batteries and other energy applications.
- A Wednesday hearing on climate change in the House Ways and Means Committee, which would vet carbon pricing legislation if Democrats go that route in the future.
- The intrigue: Per Politico, "The Ways and Means Committee yanked an invitation for former GOP Rep. Carlos Curbelo to testify at a hearing next week after other Democrats became enraged that the panel was offering a prized platform to a longtime foe."
White House: Trump will tour the Cameron LNG Export Facility in Hackberry, Louisiana. While in Hackberry, the president will also speak about "promoting energy infrastructure and economic growth," per Axios' Jonathan Swan.
5. Moody's to weigh climate risk in reports
Climate change is an enormous risk to the economy and markets. If the world manages to solve its collective action problem, investors will cheer — but, as with any major change, there will be winners and losers, Axios' Felix Salmon reports.
What to watch: Moody's, the ratings agency, is putting together what it calls a "framework to assess carbon risks." Individual companies will be given a carbon transition assessment, or CTA, which measures how well they'll be able to operate in a low-carbon economy.
"Issuers assigned the highest scores, CT-1 and CT-2, exhibit advanced positioning for carbon transition. These companies typically have a business model that benefits from the transition to a low-carbon economy."
"By contrast, companies assigned the lowest scores, CT-9 and CT-10, exhibit poor positioning and typically have business models that are fundamentally threatened by carbon transition over any time horizon, including the long term."— Moody's Investors Service
Why it matters: Carbon transition risk is already built into Moody's existing credit ratings, but it's not a large part of those ratings, largely because it's far from clear that a major carbon transition is actually going to happen.
- Now that Moody's is separating out this risk into a discrete CTA score, investors will be able to get a much clearer idea of which companies are successfully positioning themselves for a green future.