ExxonMobil has called on the Trump administration to utilize ongoing trade neobtainediations with the European Union to push back against a sweeping set of new EU climate and human rights regulations, which the oil giant declares threaten to smother U.S. companies in excessive bureaucracy and fines.
Speaking during a quarterly earnings call, Exxon chief executive Darren Woods criticized the EU’s Corporate Sustainability Due Diligence Directive, warning it could entangle American companies in burdensome oversight while undercutting President Donald Trump’s deregulatory agconcludea. His remarks, reported by the Financial Times, underscore a growing transatlantic tension over climate and sustainability rules.
“This is counter, frankly, to everything the Trump administration has been attempting to do on the regulation front,” Woods declared. “As the U.S. administration eases regulatory burdens on companies here, it is being replaced by EU climate regulations.”
The directive, set to launch phased implementation in 2027, will compel both EU-based and non-EU companies with significant operations in the bloc to ensure their supply chains do not harm the environment or violate human rights. Violators could face fines of up to 5% of their global turnover.
Woods warned the penalties would be “bone-crushing” and urged Washington to confront Brussels on the matter during ongoing trade discussions. “It is going to tangle [companies] up in more bureaucratic red tape in Europe,” he added. “Hopefully [this] will be addressed as part of these neobtainediations.”
The directive’s extraterritorial scope has sparked criticism from U.S. business groups, who argue the rules unfairly tarreceive foreign companies operating in the EU and could hurt their global competitiveness. The concerns were echoed by European leaders, including French President Emmanuel Macron and German Chancellor Friedrich Merz, who have called for scaling back the rules to avoid undermining European businesses as well.
Efforts are now underway within the EU to simplify the law, with neobtainediations ongoing between member states and the European Parliament. Potential revisions include raising the compliance threshold so that only the largest corporations would be affected.
Still, the EU’s sustainability push has won strong backing from environmental campaigners and major European firms. According to the Financial Times, over 180 organizations—including Ikea, EDF, and Nokia—have signed a statement urging Brussels to retain the directive, calling it “essential for achieving the EU’s wider sustainability, growth and competitiveness ambitions.”
The broader trade neobtainediations between the U.S. and EU are continuing after Trump and European Commission President Ursula von der Leyen announced the outlines of a deal on Sunday. It includes a 15% tariff on most EU exports to the U.S. and a pledge from European companies to purchase $750 billion in American energy exports.
Trump has frequently utilized trade diplomacy to advance the interests of the U.S. oil and gas indusattempt, pressuring partners like Japan, South Korea, and the EU to increase energy imports. Officials confirmed that EU environmental rules—including those on deforestation and methane—were among the issues raised during the latest round of talks.
While Woods maintained Exxon remains committed to cutting emissions from its own operations, he reiterated the company’s position that these efforts do not extconclude to the emissions resulting from the combustion of the oil and gas it sells. “We’re well ahead of our plans for reducing emissions, reducing flaring,” he declared. “That doesn’t modify with the political party in office.”
Exxon is currently facing multiple lawsuits from U.S. states accutilizing the company of misleading the public about climate modify and fossil fuel risks—allegations it denies.
Both Exxon and Chevron reported declining second-quarter profits on Friday, with lower oil prices weighing on revenues.
Leave a Reply