GREEN BANKING ALLIANCE SOFTENS RULES: One of the largest international green banking alliances moved to loosen its climate targets as an increasing number of banks have abandoned the group and its targets altogether in an apparent effort to get ahead of the Trump administration’s attempts to crack down on climate-focused initiatives and policies.

The details: Existing rules require members of the Net Zero Banking Alliance (NZBA) coalition to commit to an energy transition in their portfolios and operations, putting them on a path to net zero. Members are also required to align their financing with the intention of limiting global warming to 1.5 degrees Celsius above preindustrial levels.

Roughly 80% of NZBA’s members voted Tuesday on changing these rules, with 90% of the financial institutions voting in favor of loosening the targets, according to Reuters. Members will now be able to align financing with a broader range of net-zero pathways looking to meet expanded Paris Agreement temperature targets, including “well below 2 C” and not just 1.5 C, according to briefing documents reviewed by Bloomberg. They are also no longer required to set five-year emissions reduction targets.

Wall Street’s Exodus: NZBA has reportedly been considering changing its rules for weeks, as several major U.S.-headquartered and other Western banks withdrew from the coalition. In December and January, Goldman Sachs, Wells Fargo, Morgan Stanley, Citigroup, and Bank of America departed from the international alliance. The financial institutions did not explicitly explain why they left the group but insisted they would continue to focus on their sustainability goals. Following the U.S. exodus, a number of Canadian banks also followed suit. 

The departures coincided with the start of President Donald Trump’s second administration, sparking concerns among environmentalists that Wall Street was conceding to right-wing criticism of environmental, social, and governance initiatives.

Read more from Callie here. 

OIL DEMAND GROWTH SLASHED AGAIN: Projections for oil demand growth this year have been cut once again in the fallout of Trump’s trade wars and dropping prices. 

The details: The International Energy Agency estimated in its April oil market report released Tuesday that global demand for oil will only grow by around 730,000 barrels per day – a dramatic decrease from the 1 million bpd projected in March. 

IEA directly pointed to “escalating trade tensions” as a driver behind the lowered forecast, saying it will also slow growth in 2026 to just 690,000 barrels per day. Trade tensions have also been a big force behind lowering oil prices, which have also been affected by an increase in supply, IEA wrote in the report. Recent supply growth has primarily been fueled by OPEC+’s planned output increase that began this month. 

In the report, IEA noted that tumbling oil prices have notably “rattled” U.S. drillers, particularly when paired with tariffs on steel and other industry equipment. As China has imposed retaliatory tariffs on U.S. products, IEA analysts predicted that domestic U.S. oil supply will only grow by around 490,000 barrels per day this year. 

The revisions are in line with similar forecasts being made in the market, as OPEC+ cut its global oil demand growth to 1.3 million barrels per day in 2025 yesterday. Still, IEA insisted that their projections are fluid. 

“With arduous trade negotiations expected to take place during the coming 90-day reprieve on tariffs and possibly beyond, oil markets are in for a bumpy ride and considerable uncertainties hang over our forecasts for this year and next,” the report reads. 

EUROPEAN UNION MAY USE LEGAL AVENUES TO GET OUT OF RUSSIAN GAS DEALS: The European Union’s executive branch is reportedly considering using legal tactics to get out of long-term Russian gas contracts to end the bloc’s reliance on energy from Moscow. 

The details: Three EU officials familiar with the discussions told the Financial Times this week that the European Commission has specifically been looking into declaring force majeure. Force majeure is a contract provision that helps relieve both parties from their obligations under the contract due to unforeseen and extraordinary circumstances. In this case, declaring force majeure due to the war in Ukraine could allow the EU to exit contracts with Russia without paying large fees. 

But not everyone is convinced. One EU official told the Financial Times that the argument to use force majeure may not hold enough legal weight, particularly as many of these contracts between Russia and member states vary and are secret. Another avenue the commission may consider is imposing stricter tariffs on Russian imports rather than a complete ban, as the bloc can also generate revenue from high levies. 

Some background: Roughly 11% of the EU’s gas supplies are currently imported from Russia, a stark contrast to the nearly 40% imported just three years ago. Since Russian President Vladimir Putin launched his war in Ukraine, the bloc has sought to phase out its use of Russian energy products like gas. The EU is seeking to completely end its use of Russian fossil fuels by 2027, increasing imports from other suppliers like the United States. 

Something related: While the EU weighs its options regarding Russian energy, the country saw revenues from its oil exports drop to its lowest levels since mid-2023. In the four weeks ending with April 13, crude exports dropped to around 3.13 million barrels per day, with the gross value dropping by around 6% to roughly $1.29 billion per week, according to Bloomberg. 

As Russia has long relied on oil revenues to fund its campaign in Ukraine, western nations like the United States have repeatedly imposed sanctions on Russia’s energy sector. These sanctions have included the G7 price cap, banning the import of Russian oil and other petroleum products, and targeting Moscow’s “shadow fleet” of oil tankers. 

STELLANTIS CHAIRMAN SAYS U.S. TARIFFS AND EU RULES THREATEN THE AUTO INDUSTRY: The chairman of the auto manufacturing company Stellantis warned that U.S. tariffs, along with European Union emission standards, are putting the industry at risk, Reuters reports. 

“With the current path of painful tariffs and overly rigid regulations, the American and European car industries are being put at risk,” John Elkann said at the company’s annual shareholders’ meeting. 

“That would be a tragedy as car manufacturing is a source of jobs, innovation and strong communities,” he added. 

The Trump administration has imposed sweeping tariffs, including 25% tariffs on imported cars and auto parts. 

Elkann said U.S. automakers face “layer upon layer of additional compounding tariffs, including those on aluminum, steel and parts” that surpass the 25% tariffs. Trump yesterday said he is considering temporarily exempting the auto industry from tariffs, which Elkann said was encouraging to hear. 

In addition, Elkann said that the European Commission’s 2035 target for all vehicles sold in the EU to be net-zero was an “unrealistic path to electrification.” He added that some European governments withdrew purchase incentives and the charging infrastructure is insufficient. 

Stellantis is seeking a new CEO and Elkann noted that one would be picked in the first half of this year. 

Sources told Reuters that there is a five-name list for CEO, with two internal names, including the head of North American business Antonio Filosa and the head of procurement Maxime Picat. 

NEWSOM AND STATE LAWMAKERS SEEK AN EXTENSION OF CALIFORNIA’S CAP-AND-TRADE PROGRAM: California Gov. Gavin Newsom and state Senate President pro Tempore Mike McGuire and Assembly Speaker Robert Rivas announced they would seek an extension of the state’s cap-and-trade program. 

California’s cap-and-trade program is set to expire in 2030. The program aims to hold polluters accountable by putting a limit on emissions and charging entities for emitting more pollution than permitted. The program was proposed and signed by Republican Gov. Arnold Schwarzenegger in 2006.

“California must continue to lead on reducing pollution and ensuring our climate dollars benefit all residents. That’s why we’re doubling down on cap-and-trade: one of our most effective tools to cut emissions and create good-paying jobs,” Newsom and state lawmakers said in a statement. 

The announcement comes as Trump recently issued an executive order calling on the Justice Department to identify state climate laws that harm domestic energy resources. The executive order cited California’s cap-and-trade program along with New York and Vermont’s laws that impose fines on fossil fuel companies. 

“California’s efforts to cut harmful pollution won’t be derailed by a glorified press release masquerading as an executive order,” Newsom said in response to Trump’s order last week. 

POWERFUL SANDSTORM HITS IRAQ, SENDING THOUSANDS TO THE HOSPITAL: A powerful sandstorm has swept across Iraq, leaving thousands hospitalized with respiratory problems. 

Over the past two days, a massive sandstorm swept across central and southern Iraq, reducing visibility and turning the skies orange. The powerful sandstorm has led to a number of flights being canceled and left many with difficulties breathing. 

The New York Times reports that emergency rooms across the south saw 3,747 cases of people having trouble breathing due to the sandstorm. The outlet added that 1,000 of those were in Basra, where the storm was particularly strong. 

The sandstorm originated in eastern Saudi Arabia but conditions are supposed to improve today. Sandstorms are common in Iraq, but this storm has been especially severe. The last strong sandstorm was in 2022, which left one person dead and more than 5,000 hospitalized. 

The New York Times compiled a video of Iraq’s sandstorm. 

ICYMI – TRUMP ADMINISTRATION FACING CLIMATE AND SCIENTIFIC RESEARCH LAWSUITS: The Trump administration is facing a number of legal challenges over its efforts to shrink federal government spending, which has resulted in the removal of climate-related information from federal websites as well as cuts to scientific research funding. 

From the climate activists: On Monday, the Sierra Club, Union of Concern Scientists and Environmental Integrity filed a lawsuit against the Environmental Protection Agency, the Council on Environmental Quality, and the Department of Energy. The climate groups are taking issue with these agencies’ decisions to remove federal websites that contained information about climate change and environmental justice. 

The plaintiffs accused the administration of removing these webpages without warning, calling it “arbitrary, capricious, an abuse of discretion” and therefore against the law. They claimed the removals violated the Paperwork Reduction Act as well as the Administrative Procedure Act. 

“These tools are tax-payer funded and the government has a responsibility to make this information available to the public,” Darya Minovi, a senior analyst with the Union of Concerned Scientists, told Bloomberg.

From the educators: Also yesterday, a dozen universities and education groups filed a lawsuit against DOE for placing a 15% cap on “indirect costs” for research funding. Indirect costs are typically not attributed to one specific research project. The lawsuit alleges that the cap could “devastate scientific research at America’s universities and badly undermine our Nation’s enviable status as a global leader in scientific research and innovation.”

The plaintiffs – which includes Michigan State University, Princeton University, the Massachusetts Institute of Technology, the University of Illinois, Cornell University, and more – argue that the DOE violated the Administrative Procedure Act by limiting indirect costs. They argue that this could lead to cuts in staffing, training programs, and access to specialized equipment. 

Energy Secretary Chris Wright has brushed off these concerns, accusing universities of using the DOE funding to support administrative costs and facility upgrades. He has claimed the 15% cap will save taxpayers roughly $405 million every year. 

RUNDOWN 

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