Oil and gas profits have tripled under Joe Biden

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Good morning. We start with the oil and gas sector, which is set to conclude its bumper earnings season this week.

Profits of the largest US energy producers have nearly tripled under President Joe Biden, even as the industry criticizes his administration's “adversarial” policies and warns that a second term would be “disastrous” for the sector.

The nation's 10 largest listed companies by value are on track to achieve combined net income of $313 billion in the first three years of the Biden administration, up from $112 billion during the same period under Donald Trump.

US production has broken records in recent years: In November, oil production reached an unprecedented 13.3 million barrels per day, while natural gas production exceeded 105 billion cubic feet per day for the first time. The country overtook Qatar to become the world's largest exporter of liquefied natural gas last year.

The findings run counter to Republican arguments that the Biden administration has stifled the industry and dire warnings that a Democratic victory in November's presidential election would jeopardize American energy security.

Biden campaigned on the most ambitious climate platform of any US president in history, pledging to lead a “transition away from oil.” However, during his time in office, he backed away from some of those initial statements, urging the industry to drill more to combat high prices at the pump, and encouraging liquefied natural gas exports to stem Europe's energy crisis. Here's more about the wealth of the oil industry.

Here are the other things I'm tracking today:

Company Results: Devon Energy, Constellation Energy, Lowe's, JM Smucker, Norwegian Cruise, and Macy's report earnings before the bell. Cava, eBay, and Bumble will report after the market close.

Economic Data: Orders for durable goods such as washing machines and aircraft are expected to be affected by a decline in Boeing orders. The Case-Shiller home price index for 20 cities is also being published, and the Conference Board is expected to report a rise in consumer confidence in February.

Elections: Michigan is the most recent state to hold a presidential primary. The state has a large Arab-American population, and has become a center of opposition to the war in Gaza. Meanwhile, Israel is holding its first local elections since the start of the Gaza war in October.

Five more stories above

1. Emmanuel Macron said that sending Western forces to fight in Ukraine “cannot be ruled out” after 25 European leaders met yesterday in Paris to discuss the two-year-old war. The French president also said he would abandon his continued opposition to purchasing emergency artillery supplies for Ukraine from outside the European Union. The Kremlin responded today by saying that war between Russia and NATO is “inevitable” if the Western alliance sends troops to fight in Ukraine.

'Naive' Europe: Danish Prime Minister Mette Frederiksen, in an interview with the Financial Times, said that a “more aggressive Russia” requires the region to boost defense spending by limiting welfare and tax cuts.

2. US President Joe Biden expressed his hope that a temporary ceasefire would begin in Gaza next Monday, at a time when American officials are pressing hard to revive the stalled diplomatic process. A person familiar with the talks said that Hamas was reviewing the proposal, and Israeli media reported that the military cabinet had approved the broad outlines of the deal. Here are the latest developments in the peace talks.

More on the war between Israel and Hamas: Yesterday, Israel launched its deepest attack on Lebanon since the start of the war in Gaza, hitting what were said to be Hezbollah targets near the city of Baalbek in northeastern Lebanon.

3. Citigroup has appointed Vis Raghavan, a senior investment banker at JPMorgan, as head of banking, complementing a new management team and trying to jumpstart an underperforming business. Raghavan was promoted last month to sole head of investment banking at JP Morgan, following a shake-up by Jamie Dimon of his leadership team. “It's great for Jane [Fraser]said a senior Citi banker. Read the full story.

4. Microsoft has struck a deal with French AI startup Mistral, as it seeks to expand its involvement in the fast-growing industry beyond OpenAI. As part of the deal, Microsoft said it would invest in Mistral although financial details were not disclosed, but said the partnership would include R&D collaboration to build applications for governments across Europe.

5. EXCLUSIVE: French hotel group Accor is in talks with Dubai Holding to finance the €800 million development of two luxury cruise ships under the Orient Express brand, in the latest example of Middle Eastern investors' interest in the luxury travel sector, according to several people. Familiar with discussions. Here's what a potential superyacht deal could entail.

Great reading

Since Brexit, the British government has been seeking to take advantage of the opportunities that come from being outside the EU's cautious and cumbersome regulatory system. The hope was that, by being smarter, the UK could steal a march on Europe, especially in areas of emerging technologies where speed to market is a priority. But a growing number of investors and industry experts are expressing frustration and warning that a worrying gap is emerging between the UK government's stated ambitions and the capacity of regulators.

We read too. . .

Today's chart

Chinese marine research ships have dramatically increased their incursions into waters just 24 nautical miles off the coast of Taiwan, as Beijing points to their increased surveillance capabilities and data collection critical to naval warfare. The latest operations include the unprecedented sailing of China's newest research vessel, a drone carrier with links to the People's Liberation Army.

Take a break from the news

Businessman and philanthropist Lord Jacob Rothschild has died at the age of 87, his family announced yesterday. Born in April 1936, Rothschild was educated at Eton College before studying history at Christ Church, Oxford. He is the scion of a well-known British banking dynasty, and left the family business after a dispute with his cousin Evelyn. Read more about the life of a veteran in the city.

Additional contributions from Irwin Cruz and Benjamin Wilhelm