Subscribe today to the Washington Examiner magazine and get Washington Briefing: politics and policy stories that will keep you up to date with what's going on in Washington. SUBSCRIBE NOW: Just $1.00 an issue!

OIL PRODUCTION CUT APPEARS CLOSE: Saudi-led OPEC and Russia appear poised to end their price war and deliver the oil production cut President Trump has been demanding.

OPEC and its allies agreed on the outline of a deal during a remote video meeting Thursday to cut production by 10 million barrels per day, according to a report by Bloomberg .

Other reports said an agreement would last for two months.

Hold up: However, that volume of reduction, while representing the largest oil market intervention ever, pales in comparison to the demand loss caused by the coronavirus. A cut of 10 million barrels per day (representing about 10% of the world’s normal daily consumption) would barely reduce a glut of oil created by the slowdown of the global economy, with lost demand projected to reach as high as 35 million barrels per day.

And it’s unclear whether a tentative deal by OPEC+ is contingent on the U.S. and other wealthy nations also committing to cuts at a separate remote meeting of G-20 energy ministers on Friday.

Dan Eberhardt, CEO of oil services company Canary and a Trump donor, likened OPEC’s framework agreement to an “opening bid.”

“Tomorrow we’ll know how skittish the G-20 is or whether they send the ball back to OPEC+ court,” Eberhart told Josh in an email.

What counts as a US cut: Russia has appeared unwilling to accept Trump’s argument that a market-driven production cut by private companies in the U.S. suffering from low prices should count as an official contribution without some sort of mandate by the government.

“Look, we already cut,” Trump said during Wednesday night’s press briefing. “You know, we're, like, very market-oriented.” Trump added that shale producers in Texas and Oklahoma have “cut back automatically.”

The Energy Information Administration projected this week that U.S. crude oil production will fall to just over 11 million barrels per day in the fourth quarter of 2020, a 1.8 million barrel per day — or almost 15% — reduction compared to the same period last year. The consultancy group IHS Markit has projected that U.S. crude oil production will decline even further, falling 2.9 million barrels per day by the end of 2020 compared to the first quarter.

Trump, on Wednesday, warned that Saudi and Russia would pay if they don’t reach a deal and accept the U.S. position of offering market-driven cuts.

“Got a lot of good options,” he said, when asked about the potential of imposing import tariffs. “Beauties. I might like it even more.”

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Josh Siegel (@SiegelScribe) and Abby Smith (@AbbySmithDC). Email jsiegel@washingtonexaminer.com or asmith@washingtonexaminer.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.

TRUMP’S ‘STUNNING REVERSAL’ TO PUSH FOR HIGHER OIL PRICES IN ELECTION YEAR: Trump is fighting against his instincts and election-year precedent by pushing for higher oil prices, which would make gasoline more expensive.

“The price of oil is like the Goldilocks story,” said Tom Pyle, the president of the American Energy Alliance and the former head of Trump’s Energy Department transition team. “If it's too low, it's not good for producers, but good for consumers in a normal situation. If it's too high, it's not good for consumers. The price has to be just right.”

“What I am seeing is Trump is legitimately agonizing over it,” Pyle told Josh.

In one breath, Trump has likened low oil prices to a “big tax cut” for U.S. drivers, and in the next, he has implored Saudi Arabia and Russia to decrease oil production to prop up prices because “we don't want to lose our great oil companies.”

Trump seems to have settled for now on pushing for higher prices as he wrestles with a fear of losing support from the fossil fuel industry and workers.

“He is vulnerable, and he knows he is vulnerable,” Mike McKenna, a long-time fossil fuel industry lobbyist who left his job as White House energy adviser last month, told Josh.

Paul Bledsoe, a former White House energy adviser to President Bill Clinton, considers Trump’s shift to be “a stunning reversal of typical election-year policy” with limited political upside, given fossil fuel states are primarily solidly red and supportive of Trump.

“The world has turned on its head,” said Bledsoe, who now advises the Progressive Policy Institute. “The political danger for Trump is he seems far more obsessed with helping the oil industry than average consumers around the country.”

Yet Trump has more leeway to push for higher oil prices given that Americans are less able to enjoy the benefits of low gasoline prices as governments force people to stay home.

“Lower gasoline prices are not really doing anybody a whole heck of good,” said Sasha Mackler, director of the Energy Project at the Bipartisan Policy Center. “The benefits that would typically be seen as the countervailing factor against the pain in the oil sector aren’t visible or helpful right now because there aren't a lot of people spending on travel.”

Read more in Josh’s story posted this morning.

TRUMP ADMINISTRATION REBUFFS REQUESTS FOR OIL ROYALTY PAYMENT RELIEF: The Trump administration has decided for now to reject providing across-the-board relief from royalty payments that companies make to the government to drill on federal lands and waters despite requests from Republican lawmakers.

Oil companies that drill in the U.S. Gulf of Mexico had been especially vocal in calling for reducing or temporarily waiving the payments, warning that a historic price crash could force some independent producers to permanently “shut in” their wells, or stop producing.

Industry officials told Josh that the Trump administration does not want to be seen as doing anything to encourage more oil production ahead of the OPEC+ meeting Thursday.

Nicholas Goodwin, an Interior Department spokesman, told Josh companies could still apply for "discretionary royalty relief" on a case-by-case basis.

Goodwin said Interior has received one pre-application letter from a company for royalty payment relief since the coronavirus pandemic began.

HOUSE REPUBLICANS WARN SAUDIS MUST DEAL OR ELSE: Nearly 50 House GOP lawmakers led by Minority Whip Steve Scalise sent a letter to Saudi Crown Prince Mohammed bin Salman on Wednesday saying that the kingdom must cut oil production or “jeopardize the joint efforts between our nations to collaborate economically and militarily.”

CAN BIDEN EARN THE YOUTH VOTE WITHOUT EMBRACING THE GREEN NEW DEAL?: A coalition of young left-wing activists aren’t so sure. They’re asking Joe Biden, now the presumptive Democratic nominee, to sign onto major parts of their policy agenda, including aggressive climate commitments, before they’ll mobilize for him.

The groups, which include the breakout youth climate group the Sunrise Movement, NextGen America, and Justice Democrats, want Biden to go far beyond what he’s already outlined in his climate plan. For example, they’re seeking commitments from Biden to support a 100% clean energy target by 2030, 20 years earlier than what he lays out in his climate plan, and a $10 trillion green stimulus, according to a letter sent just hours after Bernie Sanders suspended his campaign.

More in Abby’s story from yesterday.

PARSING THE COMMENTS ON COOLANT LEGISLATION: Wednesday brought the end of part one of the Senate Environment Committee’s now-drawn-out virtual hearing (reformatted because of the coronavirus) over a bipartisan bill to limit greenhouse gas refrigerants, which has gotten caught up in a bitter political dispute. So far, it doesn’t look like battle lines have changed much.

There’s still a lot of support: The bill’s co-sponsors, lead Democrat on the committee Tom Carper and Louisiana Republican John Kennedy, still want the vote they didn’t get during the Senate’s consideration of a broader bipartisan energy bill. Kennedy led a dozen senators, including Republicans Susan Collins and Lamar Alexander, in a letter of support for the bill. Major manufacturers of refrigerant chemicals and appliances, who have lobbied strongly for the legislation, asked the committee to approve the bill asap. And a coalition of state attorneys general lent their support for the bill — though they also praised the bill for retaining states’ authority to set their own coolant limits.

That state authority is a major sticking point for opponents: Top Republicans in both chambers, including Chairman John Barrasso and House Energy and Commerce Ranking Member Greg Walden, said if the bill doesn’t include a prohibition on states going beyond federal limits, it would ultimately cost manufacturers and hurt consumers.

There’s also some industry trade groups with other concerns: Namely, that a quick transition to climate-friendly coolants would cost them a lot of money. Associations like the Alliance for Automotive Innovation and the Truck and Engine Manufacturers Association, which would have to transition their refrigerants under this bill, say they’d like to see lawmakers ensure a cost-effective transition for industries that use refrigerants.

Next steps: Members of the environment committee have a week to submit questions to those who commented. Expect lots of questions on the issue of federal preemption as lawmakers on both sides of the aisle try to make their case.

VOTERS LIKE OFFSHORE WIND: Even wide margins of Republican voters, according to a survey released Thursday by the American Wind Energy Association, conducted by GOP polling firm Public Opinion Strategies.

According to the poll, 80% of all voters back offshore wind, majorities of voters surveyed in both political parties and independents. A large majority of Republicans (86%) are more likely to support offshore wind when told the industry would create jobs and help boost the economies of coastal states and communities.

The poll even finds many Republicans believe the U.S. should focus more on developing wind (58%) and solar (66%) domestically than other forms of power. More than half of all voters (57%) say the wind industry will be more important to the U.S. economy in a decade than the oil and gas sector.

One interesting thing: The strongest opposition to offshore wind appears to be in the areas where development of the technology is ongoing, such as Atlantic coastal states and the Northeast. Even though a majority in those regions still back offshore wind, 20% in each region oppose the technology, more than in any other region in the country.

TRUMP’S SOMEWHAT RANDOM DIG AT TVA: Trump was quick to back dramatic cuts to the salary of the head of the Tennessee Valley Authority, the largest U.S. public power company, and he seemed to be not quite over a tiff between TVA and the White House last year over two coal plants.

When asked at Wednesday’s coronavirus task force briefing whether he’d support cutting the TVA CEO’s salary in any forthcoming infrastructure bill, Trump said he’d back “reducing it by a lot.”

He “has to be the highest paid man in any government,” Trump said. “I don’t know the gentleman, but he’s got a heck of a job.” More on the exchange in Abby’s story from yesterday.

CORONAVIRUS CASTS SHADOW ON SOLAR GROWTH: Global installations of solar PV this year could be 18% less than initially projected due to the pandemic and related economic fallout, Wood Mackenzie said Thursday.

The research firm expects spill-over effects into 2021, too, already reducing its forecast for next year’s solar installations by 3%. One bright spot, though, is China, where Wood Mackenzie sees the solar market starting to get back on track after manufacturing shutdowns and a big demand hit. The firm doesn’t expect impacts to China’s PV market to continue beyond the second quarter of this year.

The Rundown

Bloomberg G-20 to create special group to monitor oil-stabilization moves

Wall Street Journal Saudis take big stakes in European oil companies

Bloomberg Some of America’s oil refineries may be on the brink of shutting

Reuters Cargill-led fund to pay U.S. farmers for carbon capture, exchange credits

New York Times Another way to see the recession: Power usage is way down

Calendar

THURSDAY | APRIL 9

House is not expected to meet before April 20. Senate is out until April 20.