The 10-coach train can carry roughly 2,600 passengers, making it — according to Indian Railways — the world’s longest hydrogen-fueled passenger rail service. It will run on an 89-kilometer (55-mile) stretch between the northern cities of Jind and Sonipat.

The initiative marks a major milestone in Indian Railways’ broader green-energy transition, a critical shift given that over half of the South Asian nation’s electricity is still generated from thermal sources.

Germany pioneered the first commercial hydrogen passenger fleet in 2018, paving the way for pilots in the US, China, and Japan. But high infrastructure costs, the engineering complexities of high-pressure hydrogen storage and operational safety concerns continue to constrain widespread rollout.

Despite these challenges, the technology remains highly relevant. Because the true climate benefit relies entirely on scaling green hydrogen production, these trains will serve as a vital, specialized tool alongside direct electrification in the global pursuit of net-zero mobility.

Indian Railways plans to use insights from this deployment to evaluate hydrogen traction across heritage and tourist rail corridors.

©2026 Bloomberg L.P.

Carso, through a subsidiary, will purchase TotalEnergies’ 30% stake in the EP Mexico Block 30, according to a securities filing on Thursday. UK driller Harbour Energy Plc will control and operate the remaining 70% of the block, and the deal’s closing will be subject to government approvals, according to the filing.

The deal extends Slim’s holdings of the bits and pieces of Mexico’s oil and gas sector that aren’t under state control. While state driller Petroleos Mexicanos is seeking private partners to boost slumping crude output and shore up struggling finances, Slim said earlier this year his companies would steer clear of new joint ventures with Pemex.

In January, Carso purchased Fieldwood Mexico from Russia’s Lukoil, cementing its full ownership of two key Gulf fields. That followed a $2 billion contract with Pemex last year to drill more than 30 wells in the Ixachi oil and gas play, a project Slim says will roughly double crude production from that field to around 200,000 barrels a day within three years.

Carso’s other deals in recent years, including purchases of stakes in Talos Energy Inc. and US-based refiner PBF Energy Inc., have positioned the company as Pemex’s single largest private partner.

Slim said earlier this month Mexico’s total oil and gas output could reach as much as 2.5 million barrels a day with private sector help. Pemex produced 1.65 million barrels of crude and condensates per day as of the end of April.

Slim, 86, is Latin America’s richest person with a fortune of about $130 billion, according to the Bloomberg Billionaires Index, largely through telecommunications giant America Movil SAB. 

©2026 Bloomberg L.P.

Burnham’s team has asked the civil service to draw up plans for new energy and water policies that can be revealed as soon as next week, according to people familiar with the matter. He will succeed Keir Starmer as premier on Monday and is planning a series of public statements in his first days to mark a change from the previous administration.

Officials are working on a range of options, the people said. They include signaling a willingness to approve new drilling at the Jackdaw gas and Rosebank oil fields off the coast of Scotland, and an expansion of so-called tie-backs which allow further drilling on or near existing ones.

No final decision has been made on what form the North Sea announcement will take, but Burnham is likely to indicate that he is in favor of more drilling, the people said. A spokesperson for Burnham declined to comment. 

The future of North Sea oil and gas has become even more of a political flashpoint since the start of the Iran War, which has prompted countries to turn to homegrown energy sources. The current Energy Secretary Ed Miliband has resisted calls from some corners of business and politics to allow new drilling licenses, instead ramping up renewables. 

But he has faced powerful critics including US President Donald Trump and RenewableUK, a professional association with members from both the traditional energy sector and the newer, cleaner one. 

Government officials expect Burnham eventually to back at least the Jackdaw project, but public consultations have recently been launched on Jackdaw and Rosebank so his government may not be able to formally approve them before those have run their course — a constraint that has also bound the current energy secretary. 

Previous approvals for the fields were overturned by the courts. And the ultimate decision will rest with the person Burnham names to Miliband’s post, because such project approvals are not a cabinet decision.

Burnham has said he won’t name his new ministers until he takes office Monday. Miliband has been a staunch supporter of net zero policies, although has expressed a willingness to be pragmatic on North Sea oil and gas.

New drilling would draw criticism from environmentalists and some on the left of the Labour Party who have opposed it on the grounds that it would damage Britain’s net zero commitments.

One official said approving Jackdaw and Rosebank wouldn’t breach Labour’s manifesto pledge to ban fresh licenses to explore new oil and gas fields, because the licenses were granted under the previous Conservative government.

The proposal was criticized by those who support a transition to green energy. Tessa Khan, executive director of nonprofit campaign and research organization Uplift, said it would be a “mistake” for Burnham to “cave into the demands of the profiteering oil and gas industry” and warned such a decision would be “out of step with the majority of voters.”

The policy was also attacked by Green Party leader Zack Polanski who said new drilling in the North Sea would be a signal the UK is stepping back from its climate commitments. He said the government should be focusing on renewable energy instead.

Thames Water

Burnham’s aides have also tasked the civil service with preparing an announcement on the public control of Thames Water. They have told officials they want to make water a priority.

One of the options being drawn up is putting Thames Water into special administration, a form of temporary nationalization. Some officials working on the transition plans see it as likely Burnham will proceed with that outcome for the utility, which supplies 16 million customers in London and the surrounding areas.

Explainer: Why Thames Water Is Edging Closer to State Control

Burnham said in an interview with the Guardian in June that Thames Water should be nationalized. However, it remains unclear if he means temporary or permanent nationalization and the regulator Ofwat is holding off on any decision about the future of Thames until it has greater clarity.

Talks between Ofwat and senior creditors — including Apollo Global Management, Elliott Management and Silver Point Capital — have ground to a halt amid the transition of power from Starmer to Burnham. Thames Water yesterday said it needed a decision on a rescue deal by October, as it is due to run out of money in December.

The chief executive of Thames said he would respect whatever decision the new prime minister makes on the future of the company, and is keen to work with him on his plans. 

“I very much respect for him needing or saying that there needs to be greater public control,” Thames CEO Chris Weston said in an interview. “I would point out there is a huge amount of public control already over water companies.”

In recent weeks the government has shifted its stance on the future of Thames, saying it is now prepared for any outcome, having previously said it prefers a market-led solution. Polling by YouGov showed 82% of Britons support nationalizing water companies.

Burnham is interested in pursuing an approach similar to mutualization, which would see water companies converted into not-for-profit cooperatives owned and run for the benefit of customers, according to people familiar with the matter. 

The new prime minister favors the approach which would cost less than straightforward nationalization and would be more feasible to achieve, the people said. Politically it would also have the support of Labour MPs who argue it offers an route to public ownership that’s more affordable within the country’s current fiscal constraints.

Burnham will give a speech on Friday - his first since being confirmed as the next Labour Party leader - in which he will criticize the move to increased privatization in the UK since the 1980s and underline his commitment to more public control.

Burnham will argue that an “authentically Labour” administration should press ahead with a program of more public control, reindustrialization and putting more power into the hands of communities through devolution.

©2026 Bloomberg L.P.

Approving the rights-of-way and business lease requested by pipeline operator Energy Transfer LP would not be “in the best interests” of the state, according to a July 14 letter from the New Mexico State Land Office.

The decision threatens to delay Oracle’s proposed data center, known as Project Jupiter, which is expected to be driven by as much as 2.5 gigawatts of gas-powered fuel cells from Bloom Energy Corp. The campus in Dona Aña County near the US-Mexico border, has prompted strong local opposition over environmental concerns, and is also facing pushback from regulators. 

While the project would “enrich Project Jupiter’s financial backers, developers and tenants,” as well as Energy Transfer, it would generate little revenue for the state while consuming significant amounts of water in an arid region, and likely accelerating climate change, New Mexico Commissioner of Public Lands Stephanie Garcia Richard wrote in the letter to Energy Transfer.

New Mexico lawmakers said this month they’re considering introducing legislation that would impose a statewide moratorium on large-scale data centers. That would follow New York, which this week became the first state to do so, with a one-year ban on building more of the energy-hungry facilities.

Oracle said the project remains on schedule, and the company continues “to work closely with our partners and New Mexico’s public officials to move Project Jupiter forward,” according to an emailed statement. 

The New Mexico commission initially denied the applications in March, and Energy Transfer requested the following month that the agency reconsider its decision. 

Energy Transfer continues “to work through the permitting requirements as we move this project forward,” a spokeswoman said by email.

The 17-mile (27 kilometer) pipeline, dubbed the Green Chile Project, would move up to 400 million cubic feet per day of gas to the data center. Oracle in May asked federal regulators to expedite a review of the pipeline so Energy Transfer could meet an in-service target date of August 15. If the pipeline is not able to enter service by this time, “costs would increase substantially,” the tech giant said.

The pipeline is now unlikely to meet that deadline, but the companies may be able to pursue alternatives, according to Josh Garcia, senior North American gas analyst at Energy Aspects. 

“We were always pessimistic on it entering service this year and thought next year would be the earliest it could be built,” Garcia said by email Thursday. “They can reroute the pipe around the state land. but they would have to negotiate a different right of way and leases with whoever owns the land. If it’s a private owner, the project could move forward faster, but if the owner does not want it built, the project could be dead in the water.”

(Updates with comment from Oracle in sixth paragraph.)

©2026 Bloomberg L.P.

The Japan Organization for Metals and Energy Security, better known as Jogmec, has invited bids for “asset valuation and related services for the sale of equity interests in LNG projects in Asia and Oceania,” according to a tender published on Wednesday.

The government-backed company did not identify the projects being considered for potential divestment, and declined to share details in a response to Bloomberg’s request seeking comments.

Jogmec has stakes in several LNG projects across Asia and Oceania, including in joint ventures that own part of Australia’s Wheatstone LNG project and a share in Indonesia’s Tangguh LNG plant.

Managing long-term LNG supplies remains central to energy security for resource-starved Japan. Jogmec’s mandate includes early-stage financing for high-risk resource projects before transferring or selling its stakes to Japanese companies once these become commercially viable.

©2026 Bloomberg L.P.

State-owned Pakistan LNG Ltd. purchased a cargo for July 21-22 delivery at around $20.70 per million British thermal units via a tender that closed on Wednesday, according to traders with knowledge of the matter. That’s the priciest LNG purchase for the South Asian country since 2022.

Pakistan was forced to buy the shipment because a planned delivery from Qatar was canceled due to the disruptions in Hormuz — a key conduit for about a fifth of global LNG supply. This is the fourth cargo Pakistan purchased from the spot market for July delivery, as Islamabad scrambles to stave off a gas crunch and energy shortage.

Asian LNG prices have surged this month after the US and Iran resumed attacks in the Middle East. Gas flows through Hormuz have dropped since a Qatari tanker was attacked last week, forcing some buyers to rush to find replacement supply.

©2026 Bloomberg L.P.

“Markets are nervous” and grappling with “big uncertainty” due to an escalation of attacks from both sides that threatens to disrupt shipments of oil, fertilizer, natural gas and other cargoes through the key waterway, Birol said in an interview on the sidelines of the Aspen Security Forum in Colorado on Wednesday.

Visible traffic through the strait has thinned markedly over the last week as vessels were attacked and the US reimposed its blockade of Iranian shipping. Saudi Arabian oil loadings from inside the Gulf have slumped in the wake of strikes on supertankers, while the International Maritime Organization has said the waterway remains too dangerous for commercial vessels to transit.

“If the Strait of Hormuz remains closed we may again have some difficulty for global economies, including those in the region and developing nations and Asia,” Birol said. “It is not months, it is weeks” after which the strait needs to be “fully open, unconditionally open,” he said.

Although the disruption to Gulf energy and feedstock deliveries has impacted economies such as South Korea and Japan, countries like Bangladesh, Pakistan and India are far more vulnerable to such cutoffs, Birol said.  

©2026 Bloomberg L.P.

Perhaps the most profound consequence of the crisis has been the return of energy security to the centre of policymaking. Major economies have accelerated efforts to reduce exposure to supply disruption.

For global energy, this broader transformation represents a fundamental inflection point. The restoration of energy flows around the world now hinges on rewriting the risk calculus for shipping consortiums, underwriters, producers, and sovereign buyers alike, as well as on the creation of bold new energy infrastructure and supply chain routes across the Gulf and the Middle East. 

Critically, the first four months of this disruption shattered historical assumptions about global energy market vulnerability. The swift deployment and scaling up of alternative supply routes, contingency measures and the market’s unexpected resilience under maximum pressure has fundamentally altered how energy security is defined. Consequently, the legacy of the Middle East conflict is not a temporary disruption, but the catalyst for a transformational market reset. The crisis has accelerated structural shifts that had been percolating for decades: such as the return of energy security as a strategic priority, greater emphasis on supply chain resilience, increased investment in diversified energy systems and a renewed recognition of geopolitical stability as central to economic security.

Hormuz: The critical chokepoint

At the centre of the crisis lies the Strait of Hormuz, through which around 20 mbpd, or nearly 20% of global oil consumption, normally transits, alongside roughly 20% of globally traded LNG, primarily from Qatar. With few alternative maritime routes at a comparable scale, Hormuz represents one of the most concentrated sources of systemic risk in the global economy. Asian markets remain particularly exposed, accounting for approximately 84% of crude oil and more than 80% of LNG flows through the Strait. This reinforces its importance not only for Gulf producers, but for global manufacturing, electricity generation, and industrial competitiveness.

Although Iran declared the Strait closed, some limited flows continued, but at levels insufficient to stabilise markets or prevent disruption. The situation therefore evolved into constrained operations, elevated security risks, and weakened commercial confidence rather than a fully enforced physical blockade. Alternative export routes partially mitigated the scale of the shock. Saudi Arabia’s East–West pipeline, connecting the Eastern Province to Yanbu on the Red Sea, possesses a capacity of 5-7 million barrels per day (mbpd), while the UAE’s Habshan–Fujairah pipeline added a further capacity of approximately 1.5–1.8 mbpd. Together, these routes enabled the redirection of roughly 8–9 mbpd of crude exports away from Hormuz, cushioning the physical supply impact even as market disruption continued.

Risk pricing replaces physical shortages 

Initial market reactions reflected Hormuz’s strategic importance. Oil prices rose sharply, LNG markets tightened, freight rates increased, and insurance premiums surged. Yet the anticipated system breakdown did not occur. 

Instead, the crisis demonstrated how global energy markets have evolved since earlier shocks. Strategic oil reserves, diversified production, flexible LNG trade, demand adjustments, and increased supplies from the United States, Brazil, Guyana and Norway helped prevent widespread physical shortages. The result was not a scarcity-driven crisis, but one defined by elevated risk premiums. Markets continued to function, albeit at higher prices, with greater volatility and higher operating costs.

With few alternative maritime routes at a comparable scale, Hormuz represents one of the most concentrated sources of systemic risk in the global economy.

This distinction is important. Previous oil shocks were driven by physical supply losses, whereas the Hormuz disruption increasingly reflected the pricing of geopolitical risk. Markets responded not only to lost barrels, but to the probability of future disruption.

Why oil never reached US$200

One defining feature of the crisis is that oil prices remained far below extreme forecasts. At the height of the crisis, some analysts warned that a prolonged closure could push prices above US$150–200 per barrel, given that around 20% of global supply normally transits the Strait. Those scenarios did not materialise.

Five structural factors explain why:

• More diversified global supply, supported by US shale and increased output from Brazil, Guyana, Norway and other producers
• The availability of strategic reserves
• More flexible LNG and crude markets enabling rapidmrerouting
• Continued demand management and stabilisation in key consuming markets, particularly China; where strong import relationships with key suppliers, including Iran, alongside proactive measures to redirect domestic supply and manage exports, helped absorb volatility and reinforce market confidence
• Markets pricing probability rather than certainty

In addition, alternative export routes, including pipeline infrastructure from the UAE and Saudi Arabia that bypasses Hormuz, helped sustain partial flows and reduce the scale of physical disruption.

However, resilience is not unlimited. The US strategic oil reserve currently holds around 400 million barrels, down roughly 45% from 2009, reducing the buffer available to absorb future shocks. While these mechanisms helped prevent a more severe price spike, they also highlight a structural constraint: the system absorbed part of the shock by drawing down its own safeguards.

This broader lesson is that stability did not reflect reduced geopolitical risk, but the simultaneous availability of multiple emergency buffers, including strategic reserves, spare production capacity, diversified supply and demand flexibility. If not replenished, future disruptions may be absorbed less smoothly.

From energy shock to economic shock

The economic consequences have extended wellmbeyond energy markets. Higher fuel prices have affected transportation, aviation, petrochemicals, fertilisers, and manufacturing, while freight and insurance costs have lengthened delivery times and added inflationary pressures. Maritime chokepoints affect far more than oil and gas flows. They shape food prices through fertilisers, industrial competitiveness through manufacturing costs, and consumer inflation through transport and logistics.If elevated prices persist over a prolonged period, they could add between US$1 trillion and US$2 trillion annually to global energy expenditure. This underscores a broader lesson: geopolitical instability now carries systemic economic costs.

This broader lesson is that stability did not reflect reduced geopolitical risk, but the simultaneous availability of multiple emergency buffers, including strategic reserves, spare production capacity, diversified supply and demand flexibility.

This reinforces the strategic case for diversification. Investments in domestic energy systems, electricity grids, renewables, storage, and alternative fuels are no longer driven solely by climate objectives; they have become instruments of economic resilience that reduce exposure to future geopolitical shocks. 

The return of energy security

Perhaps the most profound consequence of the crisis has been the return of energy security to the centre of policymaking. Major economies have accelerated efforts to reduce exposure to supply disruption. Europe has intensified diversification strategies, China continues expanding strategic reserves and import corridors, while India, Japan and South Korea are broadening supplier portfolios. 

Maritime infrastructure and shipping lanes have reemerged as instruments of geopolitical influence. Energy security now stands alongside affordability and decarbonisation as a core pillar of energy policy. 

The rise of energy addition

One of the key structural shifts accelerated by the crisis is the emergence of an energy addition paradigm. Global demand continues to rise, driven by population growth, urbanisation, industrialisation, AI, data centres, and electrification. Meeting this demand while maintaining affordability and reliability requires more energy from all sources, rather than substitution between them. Higher prices and security concerns have reinforced the case for continued investment in oil and gas, while also increasing the strategic value of renewables, storage, grids, hydrogen, and carbon management technologies. Rather than competing in a zero-sum manner, oil, gas, and clean energy are expanding in parallel. For Gulf producers, this aligns with existing national strategies. The UAE, Saudi Arabia and others are investing across the entire energy spectrum, reflecting a broader shift toward energy addition rather than energy substitution amidst a broader strategy to enhance  energy security and ensure uninterrupted exports to international markets.

The UAE, for instance, has announced it will accelerate the construction of a new oil pipeline to double its export capacity via the port of Fujairah by 2027, reinforcing the country’s status as a reliable global energy supplier, while strengthening Fujairah’s position as a major international oil hub. The existing Abu Dhabi Crude Oil Pipeline (ADCOP), also known as the Habshan-Fujairah pipeline, can carry up to 1.8 mbpd and has proved crucial as the UAE seeks to maximise exports from the Gulf of Oman coast, just outside the Strait of Hormuz.

The path towards reopening

The US-Iran MoU and subsequent negotiations in Switzerland have increased expectations that Hormuz will gradually reopen and energy flows will normalise. However, the process remains uncertain, with implementation dependent on continued diplomatic progress over the coming weeks. Even under optimistic scenarios, recovery will be gradual. Shipping c ompanies are expected to re-enter the Strait cautiously. Risk premiums must decline, maritime security confidence must return, and backlogged vessels will take time to clear. Unlike the Suez Canal, the Strait of Hormuz lacks a formal convoy or priority transit system, making recovery more dependent on insurer confidence and commercial decisions than structured traffic management.

Historical experience suggests tanker traffic could recover to 70- 80% of pre war levels within several months, while a full return to pre-conflict conditions may take considerably longer.

Historical experience suggests tank er traffic could recover to 70-80% of pre-war levels within several months, while a full return to pre-conflict conditions may take considerably longer. 

How quickly can Gulf production recover? 

Recovery will depend on three factors: the reopening of maritime traffic, the restart of shut-in production and the extent of infrastructure damage. Where facilities remain intact, production could resume within weeks once shipping conditions stabilise. More severely damaged facilities may require months to return to full capacity.

Qatar, one of the world’s largest LNG exporters, is expected to restore output at Ras Laffan gradually, with around half of capacity returning within the first month of improved conditions and up to 80% in the following month. 

However, commercial confidence, shipping availability and insurance conditions are likely to be as important as technical capacity in determining the pace of recovery.

A new energy geography

The crisis has reshaped global energy flows rather than creating clear winners and losers. Non-Gulf producers, including the United States, Norway, Brazil and Guyana, have benefited from higher prices and increased demand for diversified supplies. Several African exporters have also gained commercial interest. For Southeast Asia, the crisis has underscored a structural challenge: how to meet rising energy demand while reducing exposure to concentrated imported risk.

The Gulf’s role in global energy security remains central. However, competitiveness is increasingly defined not only by production volumes, but by reliability, resilience and redundancy.

The Gulf’s role in global energy security remains central. However, competitiveness is increasingly defined not only by production volumes, but by reliability, resilience and redundancy. Alongside strategic investments in new energy infrastructure and hydrocarbon capacity expansion, Gulf states such as the UAE are also increasingly focusing on the full spectrum of energy portfolios and managing an integrated mix of fossil fuels, transition fuels such as LNG, and renewables. The UAE is aggressively expanding into clean energy, AI-driven energy solutions and sustainable technologies, alongside global partnerships that further strengthen its capabilities of delivering energy solutions to countries and customers around the world.

A more fragmented but resilient system

Four months into the crisis, the world has avoided the worst-case scenario. The US-Iran negotiations have reduced the immediate risk of escalation, but uncertainty remains. Over the coming weeks, markets will focus less on geopolitical tension and more on diplomatic implementation, maritime security and the gradual restoration of commercial confidence. 

Reopening the Strait of Hormuz will not restore precrisis energy order. The disruption has accelerated structural shifts in global energy markets, reinforcing the importance of resilience, diversification and strategic redundancy alongside efficiency. 

The emerging energy system is becoming more diversified, more complex and, in many cases, more expensive. Yet it is also becoming more resilient. The defining legacy of the Hormuz crisis may therefore not be disruption itself, but acceleration of a transition already underway towards an energy system shaped equally by security, resilience, diversification, and energy addition.

• This Market Outlook report was produced as a part of ADIPEC’s Energy & Geopolitics series. For more information and coverage, visit: https://www.adipec.com/press-media/insights/

Standalone battery storage systems averaged 299 cycles of charging and discharging a year in 2025, more than double the level in 2022, Ember analyst Biqing Yang said in the report on Thursday. Co-located systems, in which batteries are installed alongside wind and solar farms, also more than doubled their utilization to 199 cycles.

The gains reflect a broader shift in China’s battery storage industry. After years of requiring many renewable projects to install batteries, Beijing is increasingly relying on market-based mechanisms that let storage operators earn revenue by providing services to the power grid. While the earlier mandate helped the industry expand, it left many batteries underused because they were installed mainly to satisfy regulations.

“As the power system integrates more renewables, the true value of batteries to China’s energy transition is becoming undeniable,” Yang said. 

China added a record amount of new battery storage facilities in 2025, ending the year with more than half of global capacity. Growth has continued this year, with installed lithium-ion battery storage reaching almost 150 gigawatts by the end of the first quarter, according to Ember. The country is targeting 300 gigawatts of battery storage capacity by 2030, up from 136 at the end of 2025, in addition to expanding its fleet of longer-duration pumped hydro storage to around 160 gigawatts from 66.

The government ended co-location requirements last year and most new battery storage projects are now standalone systems that can earn revenue through a variety of ways, such as by purchasing electricity when prices are low and selling it when they rise.

Still, China can do more to improve utilization as its systems still fall short of the internationally recognized benchmark of about 350 cycles a year, Yang said. If they had reached that level last year, they could have captured and stored an additional 23 billion kilowatt-hours of renewable electricity, enough to power Singapore for about five months.

©2026 Bloomberg L.P.

The higher revenue from data centers will be used to pay for public electricity costs, such as streetlights, Deputy Interior Minister Polapee Suwunchwee told reporters after Wednesday’s meeting by the energy policy committee chaired by Prime Minister Anutin Charnvirakul. 

The Energy Regulatory Commission will determine the rate for data centers as early as the August billing, the official said. 

The plan comes as Thailand seeks to win billions of dollars of investment in AI infrastructure and hyper-scale data centers while limiting the impact of their rapidly rising electricity demand on its citizens. Alphabet Inc.’s Google, Amazon.com Inc., Microsoft Corp. and ByteDance Ltd.’s Tiktok are among tech giants investing in Thailand to tap rising demand for AI and cloud computing. On Wednesday, the Board of Investments said US semiconductor company Analog Devices Inc. plans to nearly double its workforce in Thailand and increase exports from the country.

Thailand’s move to make data centers pay more for electricity follows a widening trend globally. In the US, Portland General Electric raised power prices for data centers by about 30%, while large data centers in California may soon be required to pay surcharges to cover the cost of increased energy demand they generate under a bill aimed at helping offset the extra cost data centers impose on communities.

The committee also approved expanding the direct power purchase agreement framework to cover a broader range of industries seeking access to clean electricity, according to the energy ministry statement. 

Previously focused on data centers, the program will now also cover other industrial users with demand for clean energy. The expanded framework will enable eligible businesses to procure renewable electricity directly from generators, helping them meet increasingly stringent international trade and sustainability standards that emphasize the use of clean energy.

The move is also intended to open Thailand’s clean electricity market and promote greater competition in the power sector, the ministry said.

©2026 Bloomberg L.P.

At least 11 million barrels of US crude were sold to Asia late on Tuesday, and more deals may follow, according to traders. The buyers included refiners in South Korea, Japan and Thailand and some of the oil may load as soon as this month, they said, asking not to be named as they’re not authorized to speak to the media.

The upsurge in interest follows a hiatus when the trade went quiet due to waves of backlogged supplies from the Middle East hitting the spot market. Those flows are now under threat as the ceasefire between the US and Iran looks all but over.

The purchases came after at least three executives involved in selling US crude and procuring for Asian processors told Bloomberg they have once again started to negotiate for spot sales of American cargoes, asking not to be named as they’re not authorized to speak publicly.

The sudden spurt in US oil buying also coincided with a rally in Middle Eastern crude prices, which narrowed the price differential between the two regions.

Attacks on ships have increased in recent days, while Washington reimposed a blockade of Iranian ports. The deteriorating situation has upended shipping and oil markets, which had, until recently, been busy recalibrating as they adjusted to a recovery in energy flows from the Gulf. As of Wednesday, there was only a trickle of observable traffic going through Hormuz, although Iran has been sneaking crude tankers out of the gulf with their transponders turned off.

©2026 Bloomberg L.P.

Barito has made a non-binding cash offer that gives First Gen Corp.-backed EDC an equity value of more than $5 billion, according to the people. Including debt, EDC could reach a valuation of up to $7 billion, the people said, asking not to be identified discussing confidential information.

First Gen shares rose as much as 33% in Manila, their biggest intraday gain since the initial public offering in 2006, lifting the market capitalization to roughly $1.3 billion. Barito Renewables gained up to 3.6% in Jakarta, before paring some of the gains. Its stock has dropped more than 60% this year, giving the company a market value of almost $26 billion.

An acquisition of EDC may potentially rank as one of the largest renewable energy deals in Asia in recent years, according to data compiled by Bloomberg. It would also be among the biggest ever takeovers in the Philippines, the data showed.

The companies have been working with advisers on the potential deal, the people said, adding that deliberations are ongoing and there’s no certainty they’ll result in a transaction.

Barito Renewables is part of Barito Pacific Group. Its assets include geothermal and wind power plants, which are operated by different subsidiaries.

EDC’s backers also include Macquarie Asset Management and Singaporean wealth investor GIC Pte. The company voluntarily delisted from the Philippine Stock Exchange in 2018.

Representatives for Barito, EDC and First Gen didn’t respond to requests for comment. Macquarie Asset Management and GIC declined to comment.

First Gen, controlled by the Lopez family, is a Philippines-based clean energy company with assets spanning geothermal, hydro, wind, solar and natural gas.

©2026 Bloomberg L.P.

The collaboration combines SLB’s expertise in modular infrastructure and global project execution with Liberty Energy’s capabilities in modular power generation, behind-the-meter intelligent power controls, and operations.

Together, the companies aim to help developers deploy new data centre capacity faster while overcoming power supply constraints.

Quicker project turnaround 

The rapid expansion of AI is driving unprecedented demand for data centres, placing increasing pressure on electricity infrastructure.

As a result, developers are increasingly turning to behind-the-meter power solutions that can operate independently of traditional grid connections, enabling faster project delivery while improving reliability and operational flexibility.

“The bottleneck in AI infrastructure is no longer just compute. It is the ability to deliver infrastructure and power on the timelines the market now demands,” said Gavin Rennick, President of SLB’s New Energy and Industrial business.

“By bringing together complementary infrastructure and power capabilities, we will help developers accelerate deployment of new data centre capacity,” Rennik added. 

Meeting evolving needs

Under the agreement, SLB will provide modular infrastructure solutions, project execution expertise, and global market access, while Liberty Energy will contribute modular power generation systems, intelligent behind-the-meter controls, and operational support.

Ron Gusek, Chief Executive Officer of Liberty Energy, said the alliance reflects the changing requirements of AI-driven infrastructure. “The scale and complexity of AI energy infrastructure is fundamentally changing how power systems are built and deployed,” he said.

“Building on our long-standing relationship with SLB, we are excited to bring power solutions that address immediate capacity constraints while supporting the next generation of energy systems,” Gusek added. 

Beyond infrastructure deployment, the companies also plan to collaborate on technologies designed to improve the efficiency, flexibility, and environmental performance of future data centre energy systems.

Areas of focus include hybrid power systems, digital energy management platforms and advanced power architectures.

The partnership builds on SLB’s growing presence in the sector. Since April 2024, the company has shipped more than 1.3 GW of prefabricated modular infrastructure for data centre projects and expects cumulative global deliveries to exceed 2 GW by the end of this year.

Liberty Energy, meanwhile, plans to deploy approximately 3 GW of power projects by 2029, supporting the continued expansion of AI and high-performance computing infrastructure.

Over the past decade, this has significantly improved coordination, consistency, and digital delivery across the industry. As BIM continues to mature, the next opportunity is ensuring that it not only fulfills contractual requirements but also improves how decisions are made.

Saudi Arabia has become one of the world's leading catalysts for digital engineering transformation. Through Vision 2030 and PIF's portfolio of mega and giga projects, the Kingdom has accelerated the adoption of BIM at an unprecedented scale, setting new benchmarks for engineering excellence and digital delivery.

That distinction, between BIM as a submission and BIM as a way of working, remains one of the industry's most significant challenges. On large and complex projects, it is not simply a matter of efficiency. It directly affects project performance, delivery outcomes, and long-term asset value.

The compliance ceiling

BIM maturity and BIM value are not the same thing. A project can score well on every maturity indicator, including model coverage, coordination protocols, clash detection, and information management, and still leave the asset owner with a digital handover that offers further opportunities to strengthen operational readiness and long-term value.

This remains one of the industry's next areas of focus as organisations continue to advance their digital delivery capabilities. The reason is that BIM was framed, from the outset, as a documentation requirement.

Models must be produced, information must meet defined standards, and deliverables must be submitted at prescribed stages. Compliance establishes consistency. However, compliance should be viewed as the foundation rather than the destination. The next stage of maturity is ensuring that compliance also delivers measurable business value.

Ultimately, BIM delivers its greatest value when it moves beyond demonstrating compliance and becomes an integral part of how projects are planned, delivered, and managed.

The more important question is not whether a model was produced, but whether it changed how decisions were made. Did the model shape decisions, or simply record them after the fact? Were project teams able to rely on a single trusted source of information? Did field teams have timely access to the latest project information to support informed decisions?

Ultimately, BIM delivers its greatest value when it moves beyond demonstrating compliance and becomes an integral part of how projects are planned, delivered, and managed.

From design output to delivery platform

The next stage of BIM maturity is treating information as a project control asset rather than a design output. This means using BIM to improve predictability, strengthen decision-making, and enhance delivery performance throughout the project lifecycle.

Ultimately, owners do not invest in BIM for its own sake. They invest because better information reduces uncertainty, improves predictability, strengthens project controls, and enables better investment decisions throughout the asset lifecycle.

In that sense, BIM is not simply a digital engineering capability. It is an engineering and business enabler.

This includes testing construction sequencing through 4D planning before execution begins. It includes linking progress monitoring to field-verified information that updates schedules and forecasts in near real time. 

It also includes managing interfaces, risks, and construction constraints through a connected digital environment rather than disconnected workflows.

This is the principle behind Virtual Design and Construction (VDC). BIM no longer serves only as a representation of the project; it becomes an active platform for planning, coordination, monitoring, and control.

BIM no longer serves only as a representation of the project; it becomes an active platform for planning, coordination, monitoring, and control.

When effectively implemented, BIM supports better schedule certainty, improved productivity, stronger risk management, and greater visibility across the project lifecycle.

The foundation is data governance

Achieving this level of integration requires more than a software investment. The foundation for achieving this vision is trusted information through effective data governance.

Classification systems, naming conventions, common data environments, information ownership, and quality assurance processes determine whether project information can be trusted and used effectively. These fundamentals enable digital environments to remain connected, consistent, and trusted throughout project delivery and into operations.

Reliable information is what transforms BIM from a coordination tool into a business enabler. It provides decision-makers with greater visibility, supports executive reporting, improves project controls, and creates the confidence needed to support future digital capabilities across the asset lifecycle.

The handover challenge

Even on projects where BIM is actively used during construction, handover represents one of the greatest opportunities to maximise the long-term value of digital information. As projects become increasingly complex, ensuring that handover information is fully structured, validated, and readily usable within operational systems has become an important focus for industry.

For asset owners, the true value of BIM is realised when project information seamlessly supports operations from day one. For them, handover is not the end of a project. It is the beginning of an asset's operational life.

This is particularly important on mega and giga projects, where assets are expected to operate for decades and support entire communities, industries, and economies. The quality of information delivered at handover directly influences operational readiness, lifecycle performance, maintenance efficiency, and future investment decisions.

The industry has made significant progress in digital delivery. The next step is to ensure that this information continues to deliver value throughout the operational life of the asset.

Why this matters for Saudi Arabia

Through Vision 2030 and PIF's portfolio of mega and giga projects, Saudi Arabia is delivering some of the world's most ambitious and technologically advanced construction programs. The scale, complexity, and long-term impact of these projects make the conversation around BIM increasingly important.

The industry has already demonstrated the value of BIM adoption. The next opportunity is to build that foundation by unlocking greater intelligence, operational insight, and long-term value from project information.

The path from BIM to digital twins, connected assets, and AI-enabled operations is becoming increasingly clear. However, these capabilities depend on one critical prerequisite: trusted data.

The path from BIM to digital twins, connected assets, and AI-enabled operations is becoming increasingly clear. However, these capabilities depend on one critical prerequisite: trusted data.

Artificial intelligence, predictive analytics, and digital twins will continue to unlock new opportunities as organisations strengthen the quality and governance of their information foundations. Information quality is the foundation upon which successful digital transformation is built.

As Saudi Arabia continues to shape the next generation of infrastructure, cities, and industrial assets, the ability to create trusted digital foundations will become a defining factor in long-term success.

Beyond better models

At Nesma & Partners, we see BIM as a strategic engineering capability that supports delivery excellence across the entire asset lifecycle. Realising that vision requires more than digital tools.

It requires trusted information, disciplined governance, and engineers with the capability to transform data into better decisions. That belief shapes not only how we deliver projects, but also how we develop future engineering capability.

Through our Early Graduate Programme, we are investing in the next generation of Saudi engineers, equipping them with digital engineering, BIM, and integrated project delivery capabilities so they can contribute to increasingly complex projects from the outset of their careers and help advance the Kingdom's long-term infrastructure ambitions.

Our focus is not on BIM maturity for its own sake. It is about ensuring that information continues to create measurable value through stronger project controls, improved delivery performance, and better outcomes for our clients and asset owners.

The measure of success is not whether a model was submitted. It is whether the information behind it improved decisions, strengthened project outcomes, and left owners with a foundation they can continue to build upon long after construction is complete. The future of BIM is not about better models. It is about better decisions.

PJM Interconnection LLC, which serves 13 states and Washington, DC, said Tuesday that its auction to procure power for the year starting June 2028 tied a $16.4 billion record set in late 2025. Data centers accounted for roughly $6.3 billion of that total, said Joseph Bowring, president of Monitoring Analytics, the grid’s independent market monitor. 

That data-center burden on PJM ratepayers amounts to almost $30 billion when figures from three previous auctions are included, he said during an interview. 

Meanwhile, the auction failed for a third straight time to secure enough future supply commitments to ensure reliability in coming years, underscoring the scale of the challenge posed by the artificial intelligence boom.

The failure to meet the reliability target is “not an acceptable way to go forward,” Bowring said. The grid needs to run an auction specifically for data centers so that consumers aren’t on the hook for the extra costs, he added.

The auction fell 6.8 gigawatts short of what PJM will need to guarantee system reliability during demand spikes. The shortfall is equivalent to almost seven traditional nuclear reactors.

“This year’s auction confirms an unacceptable trend: data center load growth is outpacing new electricity supply, degrading reliability, and keeping prices at the cap,” Claire Lang-Ree, a climate and energy advocate with the National Resources Defense Council, said in a statement. New power supplies “simply can’t keep up with the pace of data center load growth, and everyone is paying the price.”

The result ramps up the pressure on a grid that’s home to Virginia’s Data Center Alley and has borne the brunt of criticism for the struggle to manage the AI boom and sufficiently protect customers from soaring costs. Attention now shifts to an emergency procurement mechanism later this year that aims to shift the burden of ramping up power generation to hyperscalers.

“Such a shortage does not necessarily mean that the PJM system will be unable to serve load reliably in the delivery year,” the grid operator said in a statement. “It means that PJM would have to operate with slimmer reserves and a greater level of risk.”

The results released Tuesday show the daily cost of those payouts hit the price ceiling of $325 per megawatt-day, which will show up in users’ monthly utility bills.

Without the cap, the auction would have cleared at $554.72 for a total cost to ratepayers of almost $30 billion, PJM said. Prices in the Chicago area would have cleared at more than $775.

A searing heat dome earlier this month showed just how close the PJM grid is to reaching its limits, with power demand likely surpassing a record that had stood for over two decades. Without urgent action, the grid risks further deterioration with demand outstripping oncoming supply.

PJM already was under intense scrutiny with data centers and power generators saying they are not being connected fast enough as consumer groups and politicians hammer the grid for spiraling power bills. Those concerns are likely to come to a head at a July 23 conference called by the Federal Energy Regulatory Commission to discuss grid governance.

The latest auction result, intended to guarantee enough capacity is available for the few hours in a typical year when demand peaks, will also put further onus of an emergency measure slated for later this year to fill the supply gap and ensure data centers pay.

“PJM customers are left to pay high capacity costs while also facing the risks of undersupply,” Drew Maloney, president of the Edison Electric Institute, said in a statement. “America’s electric companies are working every day to lower costs and keep electricity as affordable as possible, but we need swift reform, in addition to the extraordinary measures currently underway, to get more power infrastructure of all types built across the region.”

PJM has yet to submit its proposal for exactly how that will work, but the process is set to get underway in September after heavy pressure from the White House and state governors. To meet that deadline, the grid operator will have to make a filing at FERC before the end of this month.

Costs would be even higher if not for the price cap first negotiated in 2024. While that has helped keep a lid on costs, PJM has noted that there’s a downside in that it deprives the market of a price signal to induce new plant construction.

PJM Chief Executive Officer David Mills recently described the situation as “untenable.”

PJM power prices jumped 76% during the first quarter due to rampant demand from data centers, according to a report from Monitoring Analytics, the grid’s independent market monitor.

©2026 Bloomberg L.P.

Gov. Kathy Hochul (D) on Tuesday announced a pause for up to one year on state environmental permits for building more data centers, which require copious amounts of energy, water, and land for their infrastructure. The executive order applies to large data centers that use 50 megawatts or more of power — enough to provide electricity for roughly 9,000 and 40,000 homes.

AI’s Billion Dollar Tax Breaks: Data Center Incentives Fuel Backlash

Hochul’s action comes as states and the federal government are trying to remain competitive on artificial intelligence and generate jobs for communities, while also ensuring data centers don’t drain natural resources, the energy grid, or consumers’ wallets.

The governor’s move is designed to give New York State more time to put in place a regulatory framework for data center construction and figure out how big facilities will affect the environment and utility costs for ratepayers, according to a press briefing from members of the governor’s office. The pause is not intended to disrupt data center operations that benefit, for example, hospitals, education, or research, the governor’s aides said.

The New York State legislature in June passed legislation that would impose a one-year moratorium on certain permits for large data centers, among other provisions. Implementing the Responsible Data Center Development Act will take time, and the governor felt she needed to take immediate urgent action because of New Yorkers’ concerns, a Hochul aide told reporters.

Sen. Ed Markey (D-Mass.) on Monday released a discussion draft that would create a national blueprint to prevent increased energy costs, pollution, and adverse effects on health related to data center buildout.

Hochul’s executive order directs the state’s Department of Public Service to conduct a generic environmental impact statement on the effects of new data centers on energy, water, and air quality. The governor also wants DPS to look at creating a state grid acceleration fund to require data centers to invest in New York’s grid infrastructure.

“As data center development threatens to hike up utility bills, deplete our natural resources, and create uncertainty for New Yorkers, it’s my responsibility to take action and lead,” Hochul said in a statement.

Hochul also plans to work the state legislature when it returns to eliminate sales tax subsidies for data centers, which would require legislative action, one of the aides said.

States, including New Jersey and Virginia, have been moving faster than the federal government to put more guardrails around data centers in response to cost and environment concerns from communities. Lawmakers including Reps. Frank Pallone (D-N.J.), Alexandria Ocasio-Cortez (D-N.Y.), and Sen. Bernie Sanders (I-Vt.) have called for a national moratorium on AI data centers until Congress passes comprehensive legislation on the issue.

Data centers are creating jobs and attracting other investments, Dan Diorio, executive vice president of state policy and government affairs for the Data Center Coalition, said in a statment.

“As hundreds of billions of dollars are being deployed to build out the nation’s digital infrastructure, Gov. Hochul’s statewide moratorium on data centers will ensure that those investments, jobs, and economic activity flow elsewhere rather than to New York — with impacts far beyond the data center industry,” Dorio said.

©2026 Bloomberg L.P.

PJM Interconnection LLC is scheduled to disclose results from a so-called capacity auction later Tuesday that sought supply commitments from power generators and other electricity suppliers for the June 2028-May 2029 period.

PJM, which serves 67 million customers across 13 states, failed in the previous two auctions to attract enough commitments to cover reliability requirements. This comes amid increasing anxiety and political furor over sky-high power bills and in the wake of a blistering heat wave that triggered record electricity demand. 

Tuesday’s auction results will determine how much PJM will pay power generators to secure capacity starting in mid-2028. An emergency auction already has been scheduled for later this year to cover any shortfalls in supply commitments.

“The tightness the auction is meant to price is playing out live,” Evercore ISI analysts Nicholas Amicucci and Sharon Wang wrote in a note. The recent heat wave was a “timely reminder” of how burdened the system has become.

PJM is at a crossroads as the traditional pricing and supply structures intended to incentivize market participation by generators and other providers have proved inadequate to the task. Balancing the interests of ratepayers, power producers, political leaders, industrial customers and the hyperscalers driving data center development is an increasingly tricky proposition.

The price collar intended to keep costs down for consumers is capped at $325 per megawatt-day, marginally lower than the previous sale in December. That mechanism has come in for criticism as a disincentive to power plant construction.

“Another print at the top end of the price collar will only increase the pressure to push data center demand off the grid, even at the cost of servicing the AI economy,” said Peter Gardett, chief executive of Noreva, a pricing data and risk-assessment platform. “We are witnessing the beginning of the great data center migration.”

Supplies weren’t always so tight in the PJM region, but the expansion of artificial intelligence is forcing the grid operator to employ some radical solutions to make sure the lights stay on. 

PJM Senior Vice President Adam Keech wrote in a blog post last month that recent auction results showed power demand is growing faster than new generation can be built, raising concerns about system reliability. The last auction in December saw households and businesses on the hook for a record $16.4 billion to secure power in the year starting June 2027, and fell short of procuring enough power to meet reliability requirements.

The biggest beneficiaries of the high prices tend to be independent power generators like Vistra Corp., Talen Energy Corp. and Constellation Energy Corp. All three saw their shares jump after the previous auction results.

Tuesday’s results will further raise the stakes of a key July 23 technical conference convened by the Federal Energy Regulatory Commission to discuss reforms of PJM’s governance amid heavy criticism that it’s not doing enough to meet the surge in data center demand while protecting consumers from rising costs.

“The challenges facing the electric system will not be solved overnight,” Keech wrote. “These challenges require longer-term solutions.”

©2026 Bloomberg L.P.

Shipments of lithium batteries and wind turbines increased by 38% and 36%, respectively, over January-June, according to Wang Jun, deputy director of China’s General Administration of Customs.

“As the global shift toward green and low-carbon development continues to gain momentum, rising investment and consumer demand in renewable energy sectors are increasingly aligned with China’s green product offerings,” Wang said at a media briefing on Tuesday.

The growth builds on an already strong first quarter, when lithium battery exports surged by 50% from the same period a year earlier. The sustained demand reflects a global search for alternative energy sources that has been hastened by the energy-supply crunch arising from the Middle East war.

“In the first half of this year, the situation in the Middle East was tense and global supply of chemical products was tight. China, with its complete industrial system and full-chain supporting capabilities, quickly seized the sudden external demands,” Wang said, adding that the country’s exports of basic organic chemicals and primary-shaped plastics also increased by 25% and 35% respectively.

The private sector, already a dominant force in China’s foreign trade, continued to play a pivotal role. Shipments of electric vehicles, lithium batteries and solar products by private companies recorded a 46% increase in the first half, according to China Customs’ spokesperson Lyu Daliang.

“This shows that private companies have emerged as a key supply pillar for the global green transformation,” Lyu said at the same briefing.

Overall, China’s growth in exports and imports topped all forecasts in June, as surging chip prices and global demand for hardware needed to power artificial intelligence data centers lift trade across Asia. The government agency will release more detailed trade data, including sector-specific breakdowns, on July 18.

©2026 Bloomberg L.P.

The global crude benchmark climbed as much as 2.8% after surging almost 10% on Monday, while West Texas Intermediate traded near $80. Trump demanded a 20% reimbursement on cargoes — or roughly $30 million on full supertankers carrying oil — as US forces concluded another round of strikes against Iran that may last several more days.

Oil has rebounded to its highest in almost a month, paring a second-quarter drop of about 30%, as the escalating conflict rekindles concerns over supplies from the Gulf. Iran had managed to export at least 57 million barrels of crude during a brief gap between two American naval blockades, highlighting what’s at stake for the global oil market now that restrictions are being reimposed. 

Iran has been quietly moving oil tankers through the strait over the past few days as hostilities escalated. Six US-sanctioned supertankers transited the waterway into the Gulf of Oman over the past week with their transponders turned off, according to ship-tracking data compiled by Bloomberg. 

“They were just shipping oil out at unbelievable rates,” said Jay Hatfield, chief executive officer at Infrastructure Capital Management. “We think we’ll hang around this $80 level, unless there’s some movement one way or another on the strait. But I don’t think we’ll go to, like, $90 or $100. And if the strait reopens, we’ll go to $60 in one hell of a hurry.”

European natural gas surged as much as 3.3% to the highest in more than three months. Before the conflict, about a fifth of the world’s crude and liquefied natural gas passed through the strait. 

The Joint Maritime Information Center said US Central Command will begin enforcement of a blockade of all Iranian ports and coastal areas at 4 p.m. New York time on Tuesday. Trump said the US will be reimbursed by the countries it’s helping to protect in the strait, citing Saudi Arabia, the United Arab Emirates, Qatar, Bahrain and Kuwait.

Iran’s army targeted US assets in Kuwait with drones and struck “a hostile vessel” with cruise missiles, the semi-official Fars news agency reported, citing an army statement. Meanwhile, the UAE said two of its tankers were attacked in Omani waters while transiting the southern route of the strait. 

Over the past month, Gulf producers had begun marketing additional crude after the interim agreement eased export concerns. The UAE in particular proved highly successful at moving barrels by utilizing shuttle tankers sailing dark, or with their transponders off.

The UAE told OPEC that it increased crude production to 3.8 million barrels a day in June, up 1.71 million barrels from May, according to a monthly report seen by Bloomberg on Monday, after finding workarounds to the Iran conflict and ramping up output following its departure from the producer group. 

The conflict also showed signs of widening beyond the Strait of Hormuz. Saudi Arabia’s air defenses engaged with ballistic missiles fired by Yemen’s Houthis on the country’s southern region, Alekhbariya reported, citing a Defense Ministry spokesman. Earlier, the Houthis said a Saudi airstrike hit Sanaa International Airport and vowed retaliation, opening another potential front in the area. 

Elsewhere, Trump will support a Russian sanctions bill championed by the late Senator Lindsey Graham, according to a White House official who spoke on condition of anonymity. That would revive efforts to penalize buyers of Russian oil and natural gas and increase pressure on the Kremlin to end its war with Ukraine. 

©2026 Bloomberg L.P.

Crude purchases plunged 41% year-on-year to 29.27 million tons, the least since October 2016, according to customs data on Tuesday. Imports were 12% lower than May, which were already the weakest in eight years.

The recent breakdown of the US-Iran truce clouds the prospects for any revival of cargoes through the contested Strait of Hormuz. The Middle East typically accounts for about half of China’s crude purchases. Still, the oil market is on watch for signs that imports have bottomed out and that Beijing will move to replenish stockpiles. 

Natural gas imports fared better, rising 3.7% in June to a five-month high of 10.93 million tons, with volumes boosted by increased seaborne imports due to a decline in domestic output and depleted storage buffers. Although the Iran war has choked shipments from a region that typically supplies about a third of China’s liquefied natural gas, the drop has mostly been offset by other sources.

China’s other main energy import, coal, saw shipments surge last month after a crackdown on mine safety curbed domestic supplies of the fuel.

Purchases in June soared 30% to 42.78 million tons, another five-month high. The blast at a mine in Shanxi province in May was the worst coal accident since 2009, prompting a nationwide review of safety practices. 

A confluence of factors, from Indonesian supply constraints to the impact of frequent rains on hydropower output, may keep a lid on imports in subsequent months. Still, China set a record for peak electricity consumption last week, and any extended heat waves could eat through stockpiles and necessitate a buying binge.

China’s other commodities trade data for June:

• Hormuz is also a channel for global fertilizer shipments. To conserve domestic supplies, China has responded by tightening controls over its exports, which plunged 48% year-on-year to 2.23 million tons, their lowest since April 2024.
• Aluminum exports, meanwhile, continued to strengthen, soaring 45% to a record 711,000 tons to help fill the global shortage caused by the war.
• Copper imports rose 3.1% to 478,000 tons, although the figure was lower than May as the US continues to attract cargoes ahead of possible tariffs from the Trump administration.
• Iron ore imports rose 6.4% to 112.69 million tons, the year’s high, on stronger shipments ahead of the end of the financial year in Australia, where most of China’s suppliers are based.
• Steel exports, which have helped offset poor domestic demand, remained strong, rising 6.6% to 10.32 million tons.
• Soybean imports increased 11% to 13.55 million tons, a 13-month high, on arrivals from both Brazil and the US following the trade truce with Washington. All eyes are on the second half of the year as Beijing ramps up purchases of American beans to meet its obligations.

On the Wire

China’s exports and imports expanded faster than forecast in June, as surging chip prices and global demand for hardware needed to power AI data centers lift trade across Asia.

Australia’s government has moved to block three China-linked shareholders of rare earths miner Northern Minerals Ltd. from voting or exercising other rights after they defied earlier orders to sell their stock.

China’s economic growth is expected to have weakened as of the mid-year mark, once again stoking questions about whether policymakers will accelerate government spending to ensure they meet their annual target.

Huawei Technologies Co.’s $11 billion clean energy empire is opening new markets.

China’s electric-vehicle industry is often seen as a success story of the central government creating global champions through subsidies, but breakthroughs came after years of decentralized experimentation and competition.

©2026 Bloomberg L.P.

The facility will be built on a 43,669-square-metre site within SFZ and is expected to support the country’s industrial diversification ambitions by increasing local fertiliser production and boosting export capacity.

The project forms part of SFZ’s strategy to attract high-value manufacturing investments that strengthen industrial value chains and enhance the competitiveness of Oman’s industrial sector. 

Supporting Oman's Vision 2040

The development will leverage the free zone’s location on major international shipping routes, its integration with the Port of Salalah, and its logistics infrastructure to serve regional and global markets.

Once operational, the plant will manufacture ammonium sulfate fertiliser, a widely used agricultural input that improves soil fertility and crop yields. The facility is expected to help meet rising demand across regional and international markets while expanding the global reach of Omani industrial products.

The investment also complements the objectives of Oman Vision 2040 by expanding downstream manufacturing, increasing non-oil exports through the Port of Salalah, and reinforcing the Sultanate’s position as a regional hub for export-oriented industries serving Asia, Africa, and the GCC.

In addition to its industrial contribution, the project is expected to create skilled employment opportunities and generate business for Omani SMEs across sectors including logistics, engineering, construction, maintenance, and industrial services. 

The facility will also introduce advanced fertiliser production technologies designed to improve efficiency and promote more sustainable manufacturing practices.

Dr Ali Tabook, Chief Executive Officer of Salalah Free Zone, said the project would strengthen the free zone’s growing chemicals manufacturing cluster.

“This project represents a strategic addition to Salalah Free Zone’s growing chemical manufacturing portfolio and reflects our commitment to attracting investments that build integrated industrial value chains rather than standalone production facilities,” he said.

Developing local talent

He added that SFZ aims to develop an industrial ecosystem where investors benefit from integrated logistics infrastructure, industrial services, and access to international markets, helping improve the competitiveness of their operations.

Dr Tabook also highlighted the long-term growth prospects for the fertiliser industry, noting that rising global demand for agricultural products continues to support investment in chemical manufacturing.

“We see this investment as an important opportunity to strengthen Salalah Free Zone’s contribution to this vital sector by leveraging Salalah’s competitive advantages as a global logistics hub connecting manufacturers with key international markets efficiently and reliably, while supporting Oman’s economic diversification agenda and the expansion of non-oil exports,” he said.

McDermott has a long-standing legacy in the gas sector. How are you leveraging your execution capabilities to shape and scale the global LNG landscape?

With more than 60 years of LNG experience, McDermott continues to play a defining role in delivering complex infrastructure at scale. Our fully integrated delivery model – combining in-house engineering, procurement, fabrication, marine assets and a global supply chain – gives us greater control over cost, schedule and quality, enabling safe, predictable execution across geographies.

This integrated approach allows us to support the rapid expansion of LNG capacity in response to growing global demand, while maintaining execution certainty in increasingly complex environments. By aligning engineering and construction strategies from early project phases, we reduce interface risks and improve project resilience, ensuring we deliver reliable, lower-cost energy solutions at scale.

Drawing on your recent work at Golden Pass LNG, Mozambique LNG and Woodfibre LNG, how do you determine when to deploy modular versus self-perform or subcontract type stick-built execution strategies in challenging environments?

Our approach is grounded in flexibility. Every project is assessed based on location, labour availability, site constraints and schedule drivers to determine the optimal execution strategy. McDermott is uniquely positioned to deploy both modular and stick-built approaches, enabling us to tailor solutions that optimise constructability, cost and timelines. At Woodfibre LNG, for example, modularisation plays a central role, with major modules fabricated in controlled yard environments and transported to site, significantly reducing on-site labour requirements and complexity. 

Our approach is grounded in flexibility. Every project is assessed based on location, labour availability, site constraints and schedule drivers to determine the optimal execution strategy. McDermott is uniquely positioned to deploy both modular and stick-built approaches, enabling us to tailor solutions that optimise constructability, cost and timelines. 

- Rob Shaul, Senior Vice President of Low Carbon Solutions at McDermott

This approach enhances safety and quality, while minimising weather-related disruptions and enabling more efficient use of space. By shifting critical construction activities into controlled fabrication environments, we improve schedule certainty, increase efficiency and reduce on-site labour requirements by up to 70%. In contrast, projects such as Golden Pass LNG highlight McDermott’s ability to deliver complex, field-intensive construction scopes in environments that require extensive on-site execution using direct-hire labour. In other locations, such as Mozambique, our deep supply chain relationships enable us to deliver projects through our direct management of construction subcontractors.

Additionally, our early-stage involvement in projects such as Monkey Island LNG and the Rovuma LNG Phase I demonstrates how the right execution approach is evaluated and defined to align with project-specific drivers. Ultimately, this ability to flex between execution models and to define the right approach from early engineering through to construction is critical to delivering LNG projects successfully across a wide range of environments.

How does McDermott’s “concept-to-commissioning” approach support clients across the full project lifecycle, and how does this deep involvement position you for subsequent phases?

McDermott’s concept-to-commissioning model enables seamless integration across all phases of project delivery, from early-stage engineering through to construction and start-up. By engaging early, we help optimise design, execution strategy and overall project economics, creating a strong foundation for successful delivery. 

This approach strengthens collaboration with clients and partners, improves visibility on cost and schedule, and supports more informed decision-making throughout the lifecycle. It also enables us to de-risk projects by proactively addressing constraints, reducing rework and enhancing overall efficiency.

Importantly, this end-to-end approach fosters long-term relationships and positions McDermott for subsequent project phases. Our role in large-scale developments such as Mozambique LNG demonstrates our ability to sustain execution through complex project cycles, reinforcing our position as a trusted partner across the LNG value chain.

With projects like Woodfibre LNG aiming for net-zero operations, how is McDermott embedding low-carbon solutions and digital transformation into early-stage designs for future LNG facilities?

Sustainability and innovation are embedded from the earliest stages of design. McDermott integrates low-carbon solutions and renewable energy sources to reduce emissions and improve facility performance.

At Woodfibre LNG, the use of hydroelectric power significantly lowers emissions, supporting the development of one of the world’s lowest-emission LNG facilities and enabling approximately 30–90% lower emissions compared to conventional developments.

This demonstrates how execution strategy can directly advance industry decarbonisation. More broadly, modular execution contributes to sustainability by reducing construction-related emissions and minimising site disturbance through efficient, yard-based fabrication.

Digital tools and advanced design optimisation further enhance efficiency, enabling higher output from smaller footprints and improved overall project performance. By combining these innovations with our integrated delivery model, McDermott is helping clients deliver next-generation LNG facilities that are scalable, cost-effective and aligned with global decarbonisation goals.

Governor Mikie Sherrill signed legislation Monday to set up a competitive process to evaluate proposed projects, but also contains safeguards to protect ratepayers from potential cost overruns, according to a statement. 

The initiative demonstrates the rising interest in nuclear energy as demand for power climbs across the nation. However, it also reflects concerns about the industry’s history of cost overruns and delays. The last major US nuclear project involved two reactors in Georgia that was seven years behind schedule and cost more than $35 billion, more than double the original projection. 

“The decisions we make today will determine the future we leave our kids,” Sherrill said in the statement. 

While there’s strong interest in tapping fission to meet the increased need for electricity across the country, there’s little chance of any new reactors going into service anytime soon. It can take years to get all the needed permits and build a new nuclear plant, and only three have been completed in the US this century.

New Jersey gets more than 40% of its power from nuclear plants, but until April the state had rules in place that effectively prohibited construction of new reactors. Sherrill campaigned on addressing rising energy prices, and on her first day in office in January signed executive orders to set up a task force to evaluate developing nuclear projects. 

The legislation signed Monday includes provisions that shield ratepayers from cost overruns and delay any cost pass-alongs until a project is built and delivering electricity.   

©2026 Bloomberg L.P.

The company is in talks with potential technology customers to tap “mini data-center capabilities” of those systems, Powell said Monday on Bloomberg TV. 

Sunrun unveiled its distributed AI compute program last week as part of an effort by the company to tap into the demand from data centers for electricity and computing power. Shares of the nation’s biggest home solar company have slumped more than 30% this year due to investor concerns about a contraction in its main business after the federal tax credit for buying panels was eliminated.

Under the new Sunrun program, customers could make money for hosting a computer the size of a small filing cabinet. The computing capability would be aggregated and sold to technology companies racing to build out data center capacity for artificial intelligence. Sunrun said it expects to complete the pilot over the coming months and will assess the results before launching a broader rollout.

Sunrun is offering customers “another way to use that energy, if they choose, and to get compensated for it,” Powell said of the AI computing pilot program. “It could range from a couple hundred dollars to more than that in a month.”

The company has yet to release details on the economics or buyers of the distributed computing power. 

Separately, Sunrun announced an agreement with Tesla Inc. and Renew Home to aggregate more than 16 gigawatts of flexible home energy capacity for hyperscalers and utilities. The company has yet to announce a buyer of that capacity.

©2026 Bloomberg L.P.

That’s according to George Bilicic, global head of power, energy and infrastructure at Lazard Inc., which tracks the so-called levelized cost of energy. That’s the long-term electricity price a power-plant must get to break even. 

For combined cycle gas plants, that rose to $90 a megawatt-hour in 2026, according to a report Monday. That’s up from $78 a year earlier and the highest since 2009, the earliest year in the data, when the cost was $83.

It’s not just gas that’s getting more expensive. The cost for solar rose to $69 a megawatt-hour and onshore wind increased to $68, both up more than 10% from a year ago and the highest since at least 2014. 

The findings help illuminate why utility bills are climbing in parts of the US. High electric costs have emerged as a key issue for voters, and are a talking point in the runup to the midterm elections in November.

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Global benchmark Brent rose above $79 a barrel, after rallying by more than 5% last week, while West Texas Intermediate was near $74. US Central Command said on Monday it struck dozens of targets on Sunday to degrade Iran’s ability to attack international shipping passing through the waterway. 

Iran had said on Sunday the strait would be closed “until further notice,” as the Islamic Republic’s forces launched retaliatory drone and missile assaults on American allies across the Middle East, including Jordan and Qatar. In addition, Kuwait said an offshore drilling platform had been hit and damaged.

Crude has rebounded this month as the uncertainty reinserted a war premium into prices, erasing some of the declines seen in May and June after an interim peace deal offered the prospect of more supply. The flare-up risks derailing efforts to rebuild inventories, the International Energy Agency said on Friday — a reminder of what’s at stake for the global economy if the conflict continues.

The latest flare-up remains escalatory but “well short of all-out hostilities,” said Saul Kavonic, senior energy analyst at MST Marquee. “We are likely to see oil prices inch higher for as long as the strikes continue and passage through the strait remains more hesitant.”

Traffic through Hormuz — which normally carried about a fifth of global crude and liquefied natural gas supplies — was almost nonexistent on Monday, extending a slowdown since tensions flared up last week. Even so, the Joint Maritime Information Center said the southern shipping lane coordinated by Oman remains available.

European natural gas also rose on concern the escalation could hamper shipments. Futures added as much as 2.7% after gaining almost 8% last week.  

The re-escalation has dimmed prospects for diplomacy. Iran’s top negotiator Mohammad Bagher Ghalibaf declared the “era of one-sided deals is OVER,” while Tehran insisted Washington must honor commitments on Hormuz and the normalization of its oil exports before talks can resume. President Donald Trump, meanwhile, declared the ceasefire “OVER” but said the US remained willing to continue negotiations.

The attack on the Kuwaiti drilling facility at the weekend marked the first direct strike on energy infrastructure in weeks, and if the conflict expanded to target energy infrastructure more broadly, oil could head to $100, Kavonic said. 

In the past month, Persian Gulf producers including the United Arab Emirates marketed additional crude after the interim agreement eased concerns over exports. The Emiratis, in particular, were among the most successful in getting barrels out using shuttle tankers that sail dark, or with transponders off.

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Washington’s July 7 revocation of the sanctions waiver covering Iranian oil and petrochemical exports, followed by its largest strikes on Iran since the June 17 Memorandum of Understanding was signed and the Iranian strikes on US military sites in Bahrain, Jordan and Kuwait over the weekend, has brought the conflict back to a familiar crossroads: renewed military escalation or another reluctant attempt at diplomacy.

Iran, which has been firing at vessels attempting to cross Hormuz through Oman’s territorial waters in a bid to assert its exclusive oversight of the waterway as it reopened to commercial traffic, had vowed a “crushing response” to the latest US strikes.

A framework for restoring stability

The latest turn of events should alarm markets but not surprise them.

The MoU was never a robust framework for restoring stability after more than three months of a conflict, during which a stubborn chasm between Washington and Tehran on key issues repeatedly frustrated diplomacy.

The final product was a poor attempt at rapprochement between two adversaries whose differences had not really been bridged. It was a vaguely worded 14-point document that was sufficient to pause the war, but not to dependably reopen the world’s most important oil chokepoint – a task that demands clarity, consistency and confidence.

The market’s belief that Hormuz was on a steady path back to normality proved both premature and misplaced. The latest events have merely confirmed what the agreement always implied: reopening the Strait would prove considerably harder than reopening diplomacy.

The seeds of the latest crisis were sown in Point 5 of the MoU, which governs the reopening of the Strait. It required Iran to “make arrangements using its best efforts for the safe passage of commercial vessels” and promised that Tehran would levy no charges for 60 days. But it failed to answer the most important question: who controls shipping through Hormuz during the interim period?

Centre of the new crisis

That omission has now become the centre of the crisis.

Two competing transit regimes have emerged. The US, Oman and the International Maritime Organisation (IMO) support a southern corridor adjoining Omani waters for commercial shipping. Iran insists that vessels should instead use a northern route through its territorial waters after obtaining clearance from the Persian Gulf Strait Authority. Washington rejects that position outright, arguing that Hormuz must revert to its pre-war regime of free navigation.

The international shipping, insurance and trading communities need a single, publicly understood set of rules. They need to know which lanes are safe, who is responsible for security, what legal regime applies and whether a transit will be treated as lawful by both sides. Instead, they were given rival interpretations of the same agreement.

Tehran’s interpretation of the MoU

Iran’s continued strikes on vessels using or approaching the US-backed Omani corridor signal that Tehran is attempting to establish facts on the water before any permanent governance regime is negotiated. Washington’s response — revoking the oil sanctions waiver and striking Iranian coastal sites — demonstrates with equal clarity that it is unwilling to accept Tehran’s interpretation of the MoU.

Whether the conflict escalates or diplomacy resumes, the market must now factor in a more complicated picture: the Strait may not be closed in the old sense, but nor will it be reliably open in the commercial sense.

Once all the stranded tankers have escaped and the prompt barrels have been absorbed, the market will face a new fundamental reality. If empty tankers remain reluctant to return, insurance stays prohibitively expensive and rival transit regimes persist, the Gulf export system may not fully normalise for many months to come.

Layer of uncertainty

The Treasury’s 10-day wind-down period for Iranian oil transactions adds another layer of uncertainty. Iranian crude was already facing cautious buyers unsure whether sanctions relief would survive beyond its initial 60-day window. That uncertainty has now been resolved in the most bearish way for Tehran and the most bullish way for crude.

Physical balances remain comfortable for now. But a prolonged disruption to Gulf exports would rapidly swing the market from abundance towards scarcity. Severely depleted commercial and strategic stockpiles around the world mean the protective buffers of the past four months are gone.

The next move belongs to Tehran. Markets will now focus on whether Iran attempts once again to choke off Hormuz or whether both sides, however reluctantly, return to diplomacy.

A clear definition of peace

If negotiations resume, the next agreement cannot simply stop the shooting. It must define the peace. That means a clear, unified and publicly communicated understanding of how Hormuz is to operate during the interim period — who governs transits, which corridors vessels should use, what role Oman and the IMO can play, when the international Traffic Separation Scheme channels are expected to be de-mined and reopened, and whether Iran has any recognised authority to clear or charge commercial shipping.

That would be only the first step towards repairing the MoU’s fault lines. More fundamental disputes — from Lebanon's security arrangements to Iran's nuclear programme — remain unresolved and will require far greater honesty, precision and political courage than the first attempt at rapprochement. Without that, any peace is likely to prove as fragile as the agreement that sought to deliver it.

The International Energy Agency (IEA) has called on the European Union to reconsider its opposition to new oil and gas exploration in the Arctic, arguing that the region could play a critical role in strengthening Europe’s long-term energy security.

Speaking in Brussels, IEA Executive Director Dr Fatih Birol urged the European Commission to take “a very close look” at its opposition to new Arctic oil and gas exploration, arguing that Norway remains one of Europe’s most reliable energy partners.

“I support the Commission to give a very close look at this issue, because it is extremely important for the European energy security,” Dr Birol added.  

“The world needs every drop of oil from Norway,” Dr Birol said, describing the country as a trusted supplier that “will not use energy as a weapon.” 

The EU currently supports a moratorium on new Arctic drilling on environmental grounds, but the policy is under increasing scrutiny as Europe seeks to strengthen its energy resilience. 

Norway, which is not an EU member but is the bloc’s largest supplier of natural gas, has repeatedly called on Brussels to abandon its support for the ban.

Norway’s mature gas fields are expected to decline during the 2030s unless new discoveries are made beyond existing producing areas, increasing the importance of future Arctic exploration.

Environmental groups have criticised any move to relax restrictions on Arctic drilling, arguing that new projects could take more than a decade to begin production and would do little to address Europe’s immediate energy security challenges. 

“Of course, there are environmental concerns that we have to take into account, and Norway is doing that. But to say no, there should be no oil and gas exploration in the Arctic doesn’t make sense for Norway.”

- Jens Stoltenberg, Norwegian Finance Minister

Norwegian Finance Minister Jens Stoltenberg said the recent disruption to global energy markets highlighted the importance of maintaining Norwegian oil and gas production.

“Of course, there are environmental concerns that we have to take into account, and Norway is doing that,” he said. “But to say no, there should be no oil and gas exploration in the Arctic doesn’t make sense for Norway.”

A new electrification strategy

In Europe’s increasingly complex energy strategy, the bloc is seeking secure and dependable fossil fuel supplies as it works to eliminate Russian oil and gas imports by the end of 2027. But at the same time, it is accelerating electrification and expanding renewable energy to cut emissions.

Draft proposals seen by Reuters show the European Commission plans to unveil a new electrification strategy on 17 July, which aim to reduce Europe’s dependence on imported fossil fuels after multiple geopolitical conflicts sharply increased oil and gas prices. 

Since late February, the war has added an estimated $57.1 billion to the EU’s oil and gas import bill, according to EU data.

The draft electrification strategy proposes setting a 2040 target for the minimum share of the EU’s overall energy consumption that should come from electricity. 

While no specific percentage has yet been included, the objective is to speed up the transition from fossil fuels to electricity across transport, buildings, and industry.

The strategy would support wider adoption of electric vehicles, encourage households to replace gas boilers with heat pumps, and promote the electrification of industrial processes by replacing fossil fuel-powered equipment with electric alternatives.

Financial and regulatory measures 

To help offset the high initial costs of sustainable energy technology, the Commission is exploring a variety of financial and regulatory measures.

These include exploring mandatory heat pump installations in public buildings through revised public procurement rules, stronger procurement targets for electric vehicles, and a framework allowing member states to reduce value-added tax (VAT) on household batteries, electric vehicles, and heat pumps.

Brussels also plans to launch an EU funding auction later this year to support industrial projects that generate heat using electricity and renewable energy, alongside proposals to phase out fossil fuel subsidies to improve the competitiveness of electricity relative to oil and gas.

The draft strategy describes energy independence as a strategic priority, stating that “an energy-independent Union powered by clean, abundant, homegrown, cybersecure, and affordable energy is a matter of sovereignty” and calling for a “radical shift towards efficient electrification of demand.”

But this crowd had gathered for something else entirely — a chance to glimpse cutting-edge panel and battery technology from one of the world’s top solar manufacturers, China’s Jinko Solar Co.

Economies across Asia have been hit by soaring utility bills in the months since the war in the Middle East upended oil and gas markets, prompting many to rethink power supply. In the Philippines, households and businesses have embraced green alternatives, and created a welcome boon for Beijing’s solar producers  in the process.

It has become China’s single-biggest overseas market for solar panels for the first time this year, outpacing even success stories like Pakistan. Only the Netherlands, a hub for northwest Europe, imports more.

“Electricity bills here are increasing,” said Cesar Arriaga, who lives in the city’s suburbs and came along to learn about how to buy and install panels. “I like the Chinese products not only because they’re cheap, but because they’re technologically competitive.”

China is the source of the world’s most inexpensive and most advanced solar technology, producing about 80% of global supply. But it has also been producing far too much of a good thing — meaning new markets are vital for the industry’s survival.

China’s solar exports to the Philippines more than doubled in the first five months of 2026 from a year earlier, according to Trade Data Monitor. In March alone, imports jumped 262% year-on-year. Filipino buyers have spent more than half a billion dollars on Chinese panels so far in 2026.

Granted, some of that is down to suppliers front-loading shipments ahead of changes to Chinese export tax rebates. But analysts and industry insiders say the trend will prove a lasting one, even amid on-off tensions between the two countries, including disputes in the South China Sea.

One indicator is that demand has now expanded far beyond Manila into regional centers like Davao, where enthusiasts crammed the mall, fueling a leap in revenue. In 2025, Jinko’s sales to the Philippines were equivalent to nearly 1.5GW, handing it a market share of more than a quarter. In the first six months of this year, it has already shipped close to 1GW. The popularity of higher-end N-type modules, particularly effective in hot climates, have raised the company’s average selling price overseas and its profit margins.

“Based on the current pace, we expect a more pronounced market boom and demand change in the Philippines in the second half of this year,” Jinko said in response to Bloomberg queries.

That enthusiasm may well be enough to counter efforts by Manila to tighten control of imported solar equipment. Policymakers have proposed that solar systems and components should be certified by the country’s national standards body to ensure product safety, the Philippine Daily Inquirer reported. Still, unlike the US and parts of Europe, where governments have imposed tariffs on Chinese solar panels and modules to shield domestic manufacturers, the Philippines has shown little sign of pursuing broader trade barriers.

In large part, that is because both sides stand to benefit from the current boom. Import-dependent Philippines gains access to low-cost renewable technology which is easy to deploy even in an island nation, while Chinese manufacturers can tap a fast-growing export market.

“The Philippines has so much to gain by embracing solar: less pressure on retail electricity price rises, less imported gas and oil, and overall cheaper electricity for customers,” said veteran electricity analyst Dave Jones at energy think tank Ember. “Electricity prices are so high. With customers fearful that prices will rise further, this provides a firm impetus to act now.”

Chinese manufacturers also want to move quickly to tap overseas markets, especially if that means profits for an industry that has been mired in losses for years. While the Philippines remains relatively small compared to China’s behemoth domestic market, rising demand here — alongside other major importers like Pakistan — is providing an important outlet for excess capacity.

Other factors help. The Philippines has long been a key adopter of renewable power, ahead of many others in the Southeast Asian region, with a strong pipeline of wind and solar projects in development as it tries to keep up with expanding consumption. The country has also been active in encouraging foreign players to enter its clean-energy sector by allowing full foreign ownership and easing access to local financing.

“The Philippines is a key renewable market in Southeast Asia, driven by a clear structural need,” said Geoffrey Jahnke, chief operating officer at Peak Energy, which develops clean energy projects in Asia. Demand for electricity continues to rise, and the country is still exposed to imported fuel price volatility and needs more “stable, domestically supplied energy,” he said.

Rising electricity costs have provided a fresh impetus to clean up the grid, given most of that surge is directly linked to dependence on imported fossil fuels. Power prices in the Philippines have jumped at least 14% this year from last year, said Robert Liew, an analyst at consultancy Wood Mackenzie. The nation now has the costliest residential electricity price in Southeast Asia, and the second-highest commercial price, according to a May report published by Ember. 

To try to cushion the shock from Persian Gulf disruption, the government began offering low interest loans of up to 500,000 pesos ($8,124) for residential clean energy. It has also fast-tracked more than 30 renewable projects.

That means cheap Chinese solar panels are now a viable way for households to save money. Payback for a residential rooftop project can be as short as a little more than three years, down from four years in May 2025, according to Ember.

As a result, the industry is booming, as seen in Davao’s crowded mall, with exports to the Philippines smashing records in March. Average weekly rooftop solar installations have risen 170% since the US and Israel began bombing Iran in late-February, according to New Energy Nexus. 

The only catch is that with customer inquiries surging 582%, demand is running ahead of what the market can physically deliver, held back by supply chain shortages and limited numbers of installers.

“The supply chain was not built to absorb a demand shock of this size,” New Energy Nexus said in an April report.

For producers like Jinko and rival Trina Solar Co., it is still an opportunity that cannot be passed up.

“The market is moving from buying panels as standalone components toward planning solar as part of a wider energy system,” Trina Solar, another Chinese manufacturer, said in response to Bloomberg queries. “We are confident in meeting this demand.”

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The procurement process is underway, with a preferred bidder expected to be selected before the vote, Energy Minister Simeon Brown said in an interview last week. Prices for LNG are forecast to continue to come down as new supply outside of New Zealand becomes available, he said. 

The South Pacific nation relies heavily on hydropower, which leaves it vulnerable to dry years when there is little rain or snow to fill the lakes. There were shortages of electricity and prices spiked in 2024 during one such period, and the government plans to have the shipboard import terminal and regasification plant running by 2028 to mitigate that risk. 

“Every four years we have a dry year,” Brown said, adding that dwindling domestic supplies mean the country needs to look overseas. “If we can’t get the gas out of the ground domestically, we’re going to need it somewhere else. We see it as an insurance against the dry year risk, it’s about resilience, it’s about reliability, and also about affordability.

The electricity companies, known as “gentailers” in New Zealand because they both generate and retail electricity, have to work out how they will pay for the plan, Brown emphasized. “We’ve said it very clearly, it’s their obligation to fund this, because it’s their dry year risk that they must manage.”

“We’re in commercial negotiations for the gentailers to run a commercial funding model for them to pay for it,” he said.

While the long-term solution to the question of energy reliability may include renewable options, Brown emphasized that the LNG import plan was the only solution that could be done quickly, and be in place in just a few years for when there is a repeat of the 2024 dry year. 

“We’re not prepared as a government to leave New Zealand in a position where we effectively have a deindustrialization of our country, because we don’t have the molecules to be able to create electrons to keep the lights on,” he said, criticizing the Labour government’s 2018 ban on offshore oil and gas exploration and lack of planning for the transition to a lower-carbon economy. 

“Gas is critical to the transition. It is a critical transition fuel to enable that transition in a smooth manner,” he said. “We’ve ended up with a very unsmooth transition, which is a direct result of the previous government’s policies.”

The global LNG market had been expected to move into a glut this year, however the shutdown of Qatar’s export plant, the world’s biggest, due to the war in Iran has tightened the outlook. The conflict has also highlighted the dangers of relying on energy from the Middle East.

New Zealand has now built up a substantial coal stockpile at the coal-fired power plant in Huntly in case there is a dry year before the LNG plant is available, Brown said, adding that this provides “a significant amount of additional resilience that we didn’t have going into 2024.”

The opposition Labour Party is opposed to the plan, and the question is likely to be hotly debated ahead of the election later this year. The party’s energy spokeswoman Megan Woods has called it a “knee jerk reaction” to waning gas supplies, which is “excessive and rushed, and rules out viable alternatives.”

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