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Good morning! Today's Smart Brevity count: 1,285 words, < 5 minutes.

Situational awareness: "Tesla CEO Elon Musk told employees in an email sent overnight that the electric vehicle maker would attempt to restart production at its U.S. car plant in Fremont, California, on Friday afternoon." (CNBC)

🌷 And an early Happy Mother's Day to all the wonderful moms out there, and an early happy birthday (on Sunday) to Bono of U2, who opens the edition with a beautiful live performance...

1 big thing: The new politics of oil

Illustration: Rebecca Zisser/Axios

The oil industry's painful retrenchment amid the collapse in demand and prices is bleeding into Beltway political battles over pandemic response — and probably into the 2020 election.

Driving the news: Sen. Elizabeth Warren is bashing the brewing Trump administration plan to help distressed U.S. producers, warning against financial aid she says would sap resources better spent elsewhere.

  • Her open letter yesterday to the Treasury Department also says it would be inappropriate in light of the industry's emissions and posture on climate policy.
  • On the same day of Warren's letter, President Trump's campaign used Texas Gov. Greg Abbott's visit to the White House to tout the president's vows to aid the sector, highlighting this recent Abbott tweet in a press release.

Why it matters: Warren is among the highest profile Democratic lawmakers and a potential VP pick for White House hopeful Joe Biden.

  • But she's hardly the only vocal Democrat on oil policy during the pandemic.
  • A number of House and Senate Democrats are floating a messaging bill that would close off a bunch of financial aid avenues for the sector.

The big picture: The Beltway tension over aid shows how the coronavirus pandemic has upended the role of oil in political battles over energy and climate.

  • Heading into the election cycle, President Trump was fond of touting the domestic boom, which has been unfolding over a decade and transformed the U.S. into the world's largest producer (though a number of companies were financially stressed even before COVID-19).
  • His promotion of U.S. "energy dominance" contrasted with the Democratic vows to thwart new oil-and-gas development and implement tough climate policies.

Why you'll hear about this again: NYT's Lisa Friedman reports that the pandemic has entered political battles over energy and climate in a way that goes beyond the oil sector's upheaval.

  • The piece explores how Republicans and conservative groups are seeking to use the economic crisis as leverage against Democratic climate proposals.
  • "The Republicans’ line of attack is going to be that the Democrats are trying to create a massive Green New Deal that’s going to create a lot of spending at a time when we just can’t afford that," veteran GOP operative Ron Bonjean tells the paper.

What we're watching: How and whether Biden addresses the topic of the oil industry's change in fortunes due to the pandemic.

  • Biden's platform crafted before the pandemic already calls for ending new leasing on federal lands and waters, but I'm not aware of him specifically discussing the sector's financial woes.
  • His campaign did not provide comment yesterday when asked about Warren's letter.

What we don't know: It's not clear what forms of aid the administration is planning to offer.

  • Trump last month tasked the Treasury and Energy departments to construct an industry-specific financial aid plan, but it has not yet been unveiled.
  • The Fed has expanded access to its Main Street Lending Program in a way that should allow more oil companies to qualify, but Dallas Fed president Robert Kaplan cautions that it's not meant for deeply distressed firms.
2. By the numbers: Oil shuts it down

The consultancy IHS Markit now expects roughly 14 million barrels per day of crude oil production worldwide to be "cut or shut-in" during the second quarter.

The big picture: IHS analyst Jim Burkhard, in a statement, said a "rapid and brutal adjustment of global oil supply to a lower level of demand is underway."

  • He said all producing nations are subject to the "same brutal market forces," but some will be more affected than others.
  • IHS calls the cuts the largest in industry history.

Why it matters: The fresh estimate is the latest eye-popping tally of how the collapse in demand is affecting oil markets.

  • A suite of U.S. companies are announcing major cutbacks. The latest came yesterday afternoon.
  • The independent producer EOG Resources said shut-in of existing wells will cut production this month by 125,000 barrels per day.

Go deeper: Turning oil wells back on is trickier than shutting them off (Bloomberg)

3. Treasury plans breathing room for renewables

The Treasury Department is signaling that it plans to offer more time for renewable power developers to qualify for tax credits as projects are disrupted by the COVID-19 pandemic.

Why it matters: The industry is facing supply chain problems and other woes, leading to concern that a suite of projects will miss looming deadlines for incentives that are important for project finance.

What we don't know: Details. Treasury Secretary Steven Mnuchin, in a brief letter to Senate Finance Chairman Chuck Grassley, said the department "plans to modify the relevant rules in the near future."

  • Grassley is among a bipartisan group who recently pressed Mnuchin to extend what are known as "continuity safe harbor" provisions in existing guidelines.

What they're saying: The American Council on Renewable Energy, an industry trade group, said extending the deadlines would be "immensely" helpful.

  • "[T]he renewable sector has been hit hard these last couple of months by supply chain disruptions, shelter-in-place orders and other significant pandemic-related delays," the group said.

Go deeper:

4. How COVID-19 could hit green investment
Reproduced from Moody's, with April data from Refinitiv; Chart: Axios Visuals

The short-term easing of environmental pressures due to the pandemic could give way to longer term harm as investment takes a hit, Axios' Dion Rabouin reports.

The big picture: The pandemic is helping reduce the use of fossil fuels, but it is decreasing investments in things like wind and solar power and financial assets like green bonds, says Jessica Ground, global head of stewardship at Schroders.

  • "Those longer-term issues that we need finance to solve like climate change haven’t gone away and they’re still going to be here whenever we emerge from lockdown."

Driving the news: In April, total issuance of ESG bonds — green, sustainability, and social bonds — increased by 272% year over year and was double the total from March, reaching $48.5 billion, according to data from Morgan Stanley.

  • And for the first time ever, monthly sustainability bond issuance ($19.4 billion) eclipsed green bond issuance ($16.8 billion).

What it means: ESG bonds are specifically earmarked to raise money for positive social outcomes or climate and environmental projects.

Yes, but: 76% of the total ESG issuance in April came from multilateral development banks, with the majority supporting COVID-19 relief efforts, Moody's found in a recent analysis.

  • The pandemic also is pushing more companies to issue new debt to fortify their balance sheets, crowding out green bonds and other environmentally focused financial instruments.

Where it stands: Total global sustainable bond issuance fell 32% in the first quarter from Q4 2019, and green bond volumes declined 49%, per Moody's.

  • Analysts now expect their original $400 billion forecast for total sustainable bond issuance in 2020 is no longer in reach and anticipate green bond volumes falling well below their previous estimate of $300 billion.
5. Two moves say a lot about power's future

A pair of news items about the power cooperative Great River Energy, which serves the Upper Midwest, together help show where the industry is heading.

What's new: Great River Energy intends to close down Coal Creek Station, a roughly 1,150 megawatt coal-fired plant in North Dakota, in the second half of 2022.

  • It plans to replace most of the output with wind power, yesterday's announcement states.

Why it matters: The Minnesota Star Tribune notes that the closure comes several years earlier than planned, and calls it an "extraordinary move that underscores the waning cost-competitiveness of coal in electricity production."

But, but, but: It's not just about renewables and gas helping to shove coal aside. There's a storage element too. Via TechCrunch...

  • "Form Energy, which is developing what it calls ultra-low-cost, long-duration energy storage for the grid, has signed a contract with the Minnesota-based Great River Energy to develop a 1 megawatt, 150 megawatt hour pilot project."
6. Quote of the day
"There’s been an ‘aha’ moment among carmakers."

Who said it: Karl Brauer, executive publisher of Cox Automotive, quoted in the New York Times.

The context: He's explaining the financial reasons why automakers are so focused on electric SUVs and pickup trucks for U.S. markets. The "aha" realization is...

  • “There’s a massive amount of profit built into the average truck. And you can hide and absorb the cost of these batteries much easier in a $50,000 to $70,000 SUV than a $20,000 economy car.”