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A less open global economy threatens to upend President Trump’s plan to kickstart his plan for US energy dominance.

President Trump and his administration have been ardent proponents of US “energy dominance,” or at least as it applies to the production and exports of fossil fuels. However, some of the administration’s other policies have been having deleterious impacts on that goal.

American energy companies thrive in an open and unfettered economic environment — one in which business decisions are made for economically rational reasons, not politicized ones. We have made some great strides in that direction with the lifting of the market-distorting ban on US crude oil exports at the end of 2015 and President Trump’s decision to grant blanket permission for exports of liquefied natural gas (LNG), lifting President Biden’s moratorium on new approvals.

But broadly speaking, the Trump administration has moved toward a less open global economic system, introducing tariffs on friends and foes alike. While he has exempted most oil and gas imports from US tariffs to prevent a price impact on US consumers, it is not at all clear that other countries will refrain from retaliating in ways that undermine US energy commodity exports.

One of the impacts that has already taken place is the scrambling of global LNG trade flows. With the US-China trade war beginning in February, China imposed a punitive 125 percent tariff on US LNG imports. Since those contracts do not have destination clauses, that caused the Chinese recipients to swap out those volumes in exchange for volumes from other suppliers, leading to somewhat less efficient shipping routes.

The signing of the memorandum of understanding for additional volumes of piped gas from Russia via the proposed Power of Siberia 2 pipeline also could represent a big loss for US LNG exports. It may or may not ultimately come to fruition, but if it does, it would move a large tranche of Chinese gas demand growth away from the global LNG market, which is dominated by the US and Qatar, and hand it to Russia.

In a period of heightened tensions with the United States, China sees the piped gas option as beneficial due to not increasing dependency on imports that come by sea or are sourced from the United States. The other major source of demand growth for LNG is India, whose rate of economic growth has accelerated in the last decade past that of a maturing China. But the United States has stoked new trade tensions with India, imposing punitive tariffs because of India’s continuing purchases of Russian oil. It is not yet clear whether this will last over the medium to long term or impact the potential growth of US LNG exports.

On oil, there are also impacts of this policy that severely distort trade patterns. The United States had become a major supplier of crude oil to China, but punitive tariffs in retaliation for Trump’s measures in February have cut Chinese imports of US crude to near-zero over the summer months. Those volumes are going elsewhere, but if much of the world ends up imposing tariffs on US energy commodities, this could become a much larger problem.

The Trump administration has exempted energy commodities from most US import tariffs, but given the United States’ comparative advantages in energy and the availability of alternate sources, that sector will likely be targeted. Apart from the United States, most other countries are not raising tariff barriers against their other trading partners, which could eventually put US oil and gas exports at a competitive disadvantage.

Ironically, one other major impact of Trump’s trade wars is that they have shifted Canada’s focus from the United States. Where it has previously had only a modest capacity to move oil from its major production centers in Alberta to the West Coast, the Canadian government is now scrambling to add new capacity to get it out to destinations other than the United States. Much of that will eventually go to China.

Another example of a negative impact on the US energy sector is the development cost increases in both upstream and midstream segments. Oil and gas development and transportation use large quantities of steel pipes, the overwhelming majority of which are imported. Japan has a US market share of over two-thirds for this. Other steel equipment is sourced from Asia, Europe, and Mexico. Estimates of the overall impact on production costs have been about two percent to five percent, depending on the exact circumstances. Again, with most other producers in the world not having these costs imposed, they gain an advantage over US producers, who will have lower market share and reduced profitability.

US refined product exports — largely to Latin American countries that lack self-sufficiency in refining capacity — also could be impacted. The US exports over $100 billion in refined products annually. The global refining sector is a generally thin-margin business and is likely to undergo another period of consolidation in the coming years. If petroleum product importers impose tariffs to offset US tariffs on other industries, that will put serious pressure on the continued viability of some of those US refineries, giving the advantage to non-tariffed foreign competitors.

Each of the issues here may be of modest significance to the US economy individually, but as a whole, they combine to seriously undercut the notion of US “energy dominance.” The American industry would be a lot better off if we could return to the now-quaint notion of “free markets.”

Source: The National Interest

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Humanoid robots, which have made significant technological advances this year, may be at the precipice of a ChatGPT-like spike in investment and popularity — or at least, that's what many in the industry believe.So-called humanoid robots are artificial intelligence-powered machines designed to resemble humans in appearance and movement, with expected use cases across the industrial and service sectors.Makers of these robots have been working on the technology in the background for years. Now, they say they're ready to unleash the technology into the world."There is a consensus in our industry that the ChatGPT moment for humanoid robots has arrived," Xiong Youjun, general manager at the Beijing Innovation Center for Humanoid Robotics, said during a panel in Singapore on Thursday, alongside other professionals from China's robotics industry.

"This year has been defined as the first year of mass production of humanoid robots," Xiong, chief technology officer and executive director of robotics firm UBTech, said in Mandarin translated by CNBC. He added that there had been rapid progress in both the mechanical bodies and the AI-powered "brains."The original "ChatGPT moment" occurred in late 2022, when OpenAI released its groundbreaking generative AI chatbot to the public, leading to mass adoption of large language models and widespread recognition of their potential.

Tesla's Optimus robot gestures at an unveiling event in Los Angeles, Oct. 10, 2024.

Robotics players hoping to recreate that impact include Tesla's Optimus. Meanwhile, a growing number of humanoid robot start-ups are emerging in China, with companies like Unitree, Galbot, Agibot and UBtech Robotics bringing products to market.While humanoid robots are yet to reach a fraction of the adoption seen with generative AI, many experts do expect the technology to have a transformative impact on the global economy in a matter of years.Meanwhile, robots have begun to appear everywhere, from factories to technology conferences and sporting events.

Humanoids pick up steam

Tesla CEO Elon Musk has said he expects the company to produce 5,000 of its Optimus robots this year, with the technology expected to eventually make up the majority of the EV maker's business.Meanwhile, humanoid robot firms in China say their products are already being used in factories and for commercial services.Speaking on Thursday, Zhao Yuli, chief strategy officer at Galbot, said the start-up had already deployed almost 1,000 robots across different businesses.

Other companies, such as UBTech Robotics and Galbot, have also installed robots in local factories, according to local media reports.According to Zhao, these deployments have come alongside a surge of investor interest and government support in the sector, as well as the maturation of both robotics and generative AI technology.Industry experts noted that this maturation in technology has been on display at a number of conferences and events this year, such as China's World Humanoid Robotics Game, which sees robots compete in practical scenarios.

Galbot won a gold medal in the Robot Skills event after placing first in a pharmaceutical sorting challenge.Improvements in Chinese humanoid robots' motion control have also been on display in recent months at sporting events such as marathons and boxing matches.Guo Yandong, founder and CEO of AI² Robotics, added that improvements in generative AI have also enabled robots to learn on the job rather than rely solely on preset commands, a shift that could expand the uses of humanoids across sectors.

Not so fast

Despite the hype from humanoid robotics companies, however, many experts resist the idea that mass public adoption will occur anytime soon."Humanoids won't arrive all at once in a ChatGPT moment, but slowly enter more and more positions as their capabilities increase," said Reyk Knuhtsen, analyst at SemiAnalysis, an independent research and analysis company specializing in semiconductors and AI. He added that their first uses will be in low-stakes, failure-tolerant tasks.That's not to mention long manufacturing timelines and high costs, which will also slow adoption compared to generative AI, he added.

UBTech humanoid robot is on display during the 27th China Beijing International High-tech Expo at China National Convention Center on May 8, 2025 in Beijing, China.

Even UBTech's Xiong conceded that some hurdles remain for the sector, such as ethical considerations, laws and regulations that need to be addressed.Still, analyst Knuhtsen expects investment in the space to continue as long as the autonomy of the robots continues to improve."The market opportunity for humanoids is enormous, contingent on how well the AI performs ... If the technology works, it has the chance to transform many labor processes around the world," he said.Merrill Lynch analysts recently estimated in a research note that global humanoid robot shipments will reach 18,000 units in 2025 from 2,500 units last year. It also predicts a global robot "population" of 3 billion by 2060.

Source: CNBC

India’s exports rose for a second month in August after President Donald Trump’s 50% tariffs took effect, as businesses front-loaded shipments.

The trade deficit narrowed to US$26.49 billion (RM111.39 billion) last month from an eight-month high of US$27.35 billion in July, data released by the Ministry of Commerce and Industry showed Monday. Economists in a Bloomberg survey had predicted a US$24.8 billion deficit for August.

Imports fell 10.1% in August to US$61.59 billion from a year earlier, while exports rose 6.7% to US$35.1 billion.

This is the first trade data since the US slapped a 25% tariff on Indian goods on Aug 7, doubling it 20 days later to punish New Delhi for buying Russian oil. The levies are among the highest in the world and threaten to make Indian exports, especially labour-intensive goods, uncompetitive against regional rivals like Vietnam and Bangladesh.

Businesses advanced their orders before the US tariffs came into effect, with outbound shipments to the US — India’s top export market — reaching US$40.39 billion between April and August, up from US$34.21 billion a year earlier, the data showed.

India-US relations showed some signs of improvement last week as Trump and Prime Minister Narendra Modi pledged to resume trade talks. A trade team from the US will be in New Delhi Monday night, India’s chief negotiator Rajesh Agarwal told reporters at a briefing.

New Delhi is also trying to help exporters expand in newer markets and is pursuing a free trade pact with the European Union with heightened urgency, with the next round of talks set for Oct 6-10.

Commerce Secretary Sunil Barthwal told reporters Monday that India is working to reduce its dependence on certain geographies to limit the impact of supply chain disruptions. The government has also identified about 100 products where India can boost its domestic manufacturing in order to cut reliance on imports, he added.

The data also showed that gold imports rose to US$5.4 billion last month, compared to US$3.9 billion in July, while crude oil imports stood at US$13.2 billion in August, down from US$15.5 billion the previous month.

Source: Theedgemarkets

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