Today: The S&P 500 index closed above 6,000 points yesterday after giving up some gains and is now up 0.65% on the month, having regained most of the losses it saw immediately before Christmas. Asian and European stocks ticked up this morning. US futures called for some profit-taking today.
Moscow rejected Trump’s call for a ceasefire in Ukraine. “A ceasefire is a road to nowhere,” Russian Foreign Minister Sergei Lavrov said.
Europe’s competitiveness is “in a crisis”
Is 2025 going to be the year in which Europe becomes competitive again, after years in which it trailed both the US and China in economic performance? Not according to Philippe Ducom, President, Europe, of oil giant Exxon.
Europe’s competitiveness is “in a crisis”, he told me in a phone interview. And if in the next few years the EU keeps trying to regulate itself out of the crisis, “it’s not going to work.”
Despite his company having major operations in the continent, and investing $20 billion globally in decarbonization by 2027, the Texas-based company isn’t anticipating more than a “fraction” of its investments to happen in Europe. The US is expected to get much more of Exxon’s clean energy investments, including new low-carbon hydrogen and lithium plants in Texas and Arkansas.
The rift between Europe’s policymakers and some of the bloc’s largest energy suppliers isn’t surprising, given that oil and gas were designated "non grata" in the bloc’s future plans.
While Exxon has repeatedly stated it supports both the Paris Agreement and the EU’s ambitions to decarbonize, it has also always made it clear it doesn’t plan to limit its supply of fossil fuels as long as demand for it exists.
“Whether to get rid of oil and gas is not the right question,” Ducom repeated his company’s mantra to me. “How to shift demand is the real question. We cannot legally and will not lower supply when the demand is there.”
It’s not surprising, either, that Ducom particularly dislikes ESG-related regulation, such as the EU’s Corporate Sustainability Reporting Standards (CSRD), which kicked in this year, and the EU’s Corporate Sustainability Due Diligence Directive (CSDDD) which is gradually coming into effect as of 2026.
“Pausing CSDDDD and CSRD would be a very strong message to say, we heard you,” he told me. “The first and best thing is to reduce regulatory burden.”
It’s unlikely Ducom’s comments will be broadly cheered, let alone implemented in European political circles. But with Europe’s economy stagnant, many of Germany’s industries losing competitiveness, and a more hostile trade environment in the US looming, the company’s warnings may need to be taken more seriously.
This week, Qatar’s energy minister also warned of the consequences of implementing the CSDDD, which seeks stricter oversight in companies’ supply chains regarding carbon emissions, human and labor rights.
“If the case is that I lose 5 per cent of my generated revenue by going to Europe, I will not go to Europe . ... I’m not bluffing,” Saad Al-Kaabi, the Qatari energy minister told the FT this week. (The CSDDD “requires EU countries to introduce powers to impose fines for non-compliance with an upper limit of at least 5 per cent of the company’s annual global revenue”, the paper also reported).
Exxon, which has 6,000 Esso service stations in Europe, and 5 refineries, isn’t as brazen in its threats to the EU. But Ducom equally doesn’t think there is much for the continent to look forward to in the new year either, unless radical policy changes are made.
“Decarbonization through deindustrialization really is not the right thing to do, but it’s the path Europe is on right now.”
Also on the radar today:
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Russian anti-aircraft fire probably caused the civilian plane crash in Kazakhstan on Christmas Day. Thirty-eight people died but 29 survived.
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The extremely long list of everything Trump said he would do on “Day One” of his new administration.
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Only 19% of Americans believe the country is heading in the “right direction,” according to a new poll by Gallup.
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Richard D. Parsons, the former CEO of Time Warner and chairman of Citigroup, has died. He was 76.
- Elon Musk has been taking the weight-loss drug Mounjaro. He christened himself "Ozempic Santa" in a photo post on X.
From the analysts:
Goldman Sachs expects global real GDP growth of 2.7% year-on-year in 2025 and “above-consensus” real GDP growth of 2.4% year-on-year in the U.S. The bank is still expecting three interest rate cuts from the Fed, of 25 points each, according to a note seen by Fortune.
More news below.
Peter Vanham
peter.vanham@fortune.com
