U.S. Threatens to Leave International Energy Agency over Climate-Focused Forecasts

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Written by Eric Funderburk for IIR News Intelligence (Sugar Land Texas)

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Summary

The Trump administration last week threatened that the U.S. would exit the International Energy Agency unless the Paris-based agency changes the way it presents various climate and energy scenarios in its forecasting.

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U.S. Applies Pressure

Last week, the Trump administration threatened to drop out of the influential Paris-based International Energy Agency (IEA) unless the agency changes the way it incorporates climate, energy and emissions information into its forecasting.

The comments came from U.S. Secretary of Energy Chris Wright during the IEA's annual meeting of energy ministers in Paris. At the heart of the matter is that officials of the Trump administration want the agency to stop providing a "net-zero" forecasting scenario in which neutral greenhouse gas emissions are achieved by 2050 and fossil fuel use plummets.

Instead, Wright said the administration wants the IEA to address "energy security" and to no longer provide the "net-zero" scenario, which Wright described as "ridiculous," instead presenting a future where demand for fossil fuels such oil and gas remains relatively strong and steady for years to come.

The "Net-Zero" Scenario

The IEA's "net-zero" scenarios that show emissions neutrality achieved by 2050 present a dramatically altered near- and long-term future. Introduced by the agency in 2020, the forecasting scenario, which presents a rapid phasing-out of fossil fuel use throughout the world, includes the world transitioning to virtually entirely electric vehicle use and retiring almost all coal-fired power plants. In this scenario, oil and gas production declines very precipitously.

The clash with the Trump administration should be obvious from just these talking points. The second administration of President Donald Trump has:

• Forced retiring coal-fired power plants to stay open.
• Attempted to expand U.S. coal-mining leases.
• Ramped up approvals of U.S. liquefied natural gas (LNG) projects, strongly encouraging countries to make U.S. LNG part of their energy mix.
• Consistently promoted the idea that U.S. fossil fuel resources can help the country achieve "global energy dominance."
• Drastically shortened the timeline under which wind and solar projects can receive existing federal tax credits that incentivize their construction.
• Increased red-tape in permitting renewable energy projects.

Little wonder, then, that the IEA's "net-zero" scenario, which more or less presents a world absolutely contradictory to the Trump administration's energy policies, has not found favor with the White House.

U.S. Already Has Placed Pressure on the IEA

The Trump administration already has exerted pressure on how the IEA presents its future energy scenarios--and, in fact, succeeded in its aims.

Before 2020, the IEA's annual outlook included a "current policies" scenario, which presented a world in which countries implemented their current emissions policies, and how this world would evolve with no change in national policies. The agency's "current policies" scenario "typically showed that oil, gas and coal were expected to dominate the global energy mix for decades to come," according to The New York Times.

This no-change scenario became less realistic as more countries committed to reducing emissions either on their own initiative or as part of agreements such as the Paris Agreement, in which a majority of nations have pledged to reduce greenhouse gas emissions. Trump has withdrawn the U.S. from the Paris Agreement in both of his administrations.

Accounting for these policy shifts, in 2020 the IEA did away with the current policies scenario and instead implemented the "stated policies" scenario, which accounts for nations' policies moving forward, with particularly regard to their emissions-reduction schemes.

Under this scenario, oil and gas demand declined much faster than in the previous "current policies" scenario, but not at the rapid pace of the "net-zero" scenario that calls for neutral emissions by 2050. In recent years, the "stated policies" scenario has suggested that global oil and gas demand would begin declining around the end of this decade.

Whether negative movement in oil and gas demand in the very near-term is a realistic scenario or not, it is very much not in keeping with the Trump administration's goal of U.S. energy dominance, which stresses both domestic and international consumption of fossil fuels.

Since returning to office last year, the Trump administration has increasingly pressured the IEA to return to its "current policies" scenario that shows a long and healthy future for oil, gas and coal.

And the White House got its way. Reportedly due to intense pressure from Wright, the agency again began publishing the "current policies" scenario again in last year's annual World Energy Outlook. For more on the 2025 Outlook, see November 20, 2025, article - IEA Connects Energy Security with National Security.

Lobbying for Another Change

Now, the Trump administration is pressing for another change in the IEA's forecast: It wants the agency to eliminate the "net-zero" scenario entirely. "We don't need a net-zero scenario, that's ridiculous, it's not going to happen," Wright said last week in a side event at the IEA meeting. He added, "If they insist that it's so dominated and infused with climate stuff, then we're out," suggesting the U.S. will leave the influential agency unless it changes its reporting style.

And there is a lot at stake for the IEA. The U.S. is one of 32 IEA member countries and, according to The New York Times, provides about 14% of the agency's budget. And the U.S. may get its way again. At a Thursday news conference, two days after Wright's comments, IEA Executive Director Fatih Birol said the agency had not decided whether it would continue to provide the "net-zero" scenario and instead emphasized what the member states were in agreement on.

Other International Pressure

The White House succeeded in thwarting another world-reaching emissions policy last November, when more than 100 countries seemed poised to sign an agreement to implement a fee on heavily polluting cargo vessels in a push to clean up the maritime shipping industry. The agreement had been negotiated over several years by the International Maritime Organization (IMO), which regulates global shipping policies.

As this attempt at pollution reduction flew against the Trump administration's promotion of increased fossil fuel use, the State Department began applying pressure to countries and their representatives to vote against implementing the policy. An Asian ambassador was reportedly told his country's sailors would not be allowed to disembark at U.S. ports if he supported the rule. Caribbean members were told they might be blacklisted from the U.S. Reportedly, Secretary of State Marco Rubio personally made several calls threatening financial penalties on countries if they supported the measure. Tariffs, sanctions and the revocation of diplomatic visas were also put on the table, according the Times.

The U.S. wasn't the only country asserting pressure against the deal. Saudi Arabia also worked to defeat the deal. The White House denied using any coercive tactics, but its threats, "which were mostly aimed at leaders from poorer or small countries that are economically dependent on the United States," according to the Times, seem to have been the primary driver in the blocking the vote on the policies, which had been in preparation for years.

Key Takeaways

• U.S. Energy Secretary Chris Wright said the U.S. may drop out of the IEA unless the agency stops reporting a "net-zero" emissions scenario in its annual World Energy Outlook.
• The U.S. implemented successful pressure on the agency to resume its "current policies" scenario in its forecasting, which forecasts strong global fossil fuel consumption for years to come and is in keeping with current U.S. energy policies.
• The White House last year made a successful effort to stop the implementation of a global maritime fuel policy aimed at reducing greenhouse gas emissions from the maritime shipping industry.

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About IIR News Intelligence
IIR News Intelligence is a trusted source of news for the industrial process and energy markets, powered by Industrial Info Resources' Global Market Intelligence (GMI).

About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 250,000 current and future projects worth $30.2 Trillion (USD).