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USA Gasoline Price Projected to Drop Below $2.90 in 2026

In its latest short term energy outlook (STEO), which was released on September 9, the U.S. Energy Information Administration (EIA) projected that the U.S. regular gasoline retail price will average under $2.90 per gallon in 2026. According to that STEO, the EIA expects the U.S. regular gasoline retail price to come in at $2.86 per […]

In its latest short term energy outlook (STEO), which was released on September 9, the U.S. Energy Information Administration (EIA) projected that the U.S. regular gasoline retail price will average under $2.90 per gallon in 2026.

According to that STEO, the EIA expects the U.S. regular gasoline retail price to come in at $2.86 per gallon next year. The STEO, which highlighted that the gasoline price averaged $3.31 per gallon in 2024, sees gasoline coming in at $3.09 per gallon in 2025.

A quarterly breakdown included in the EIA’s latest STEO showed that the EIA expects the U.S. regular gasoline retail price to average $3.14 per gallon in the third quarter of this year, $2.96 per gallon in the fourth quarter, $2.73 per gallon in the first quarter of 2026, $2.89 per gallon in the second quarter, $2.99 per gallon in the third quarter, and $2.84 per gallon in the fourth quarter.

The STEO pointed out that the U.S. regular retail gasoline price averaged $3.10 per gallon in the first quarter of 2025 and $3.16 per gallon in the second quarter.

“Falling oil prices in our forecast lead to a drop in gasoline prices,” the EIA said in its latest STEO.

“We expect the U.S. average retail price for regular grade gasoline will average about $3.10 per gallon this year, down 20 cents per gallon from last year,” it added.

“Retail gasoline prices in our forecast fall to an average of $2.90 per gallon in 2026, with the annual average price falling below $3.00 per gallon in all regions except the West Coast,” it continued.

In its latest gasoline fuel update, which was released on September 16, the EIA showed a declining trend in the U.S. regular gasoline price.

That update highlighted that U.S. regular gasoline averaged $3.192 per gallon on September 8 and $3.168 per gallon on September 15. The September 15 price was $0.012 lower than the year ago price, the fuel update outlined.

Of the five Petroleum Administration for Defense District (PADD) regions highlighted in the EIA’s latest fuel update, the West Coast was shown to have the highest U.S. regular gasoline price as of September 15, at $4.273 per gallon. The Gulf Coast was shown in the update to have the lowest U.S. regular gasoline price as of September 15, at $2.774 per gallon.

A glossary section of the EIA site notes that the 50 U.S. states and the District of Columbia are divided into five districts, with PADD 1 further split into three subdistricts. PADDs 6 and 7 encompass U.S. territories, the site adds.

According to the AAA Fuel Prices website, the average regular gasoline price in the U.S. is $3.199 per gallon, as of September 19. Yesterday’s average was $3.203 per gallon, the week ago average was $3.188 per gallon, the month ago average was $3.130 per gallon, and the year ago average was $3.224 per gallon, the site showed.

The highest recorded average price for regular gasoline in the U.S. was seen on June 14, 2022, at $5.016 per gallon, the AAA Fuel Prices website pointed out.

“As drivers settle into their fall routines, gas demand is going down, and eventually, pump prices should follow suit,” AAA Fuel Prices said in a statement posted on its site on September 11.

GasBuddy’s live ticking average for regular gasoline in the U.S. was $3.209 per gallon as of 7.20am EST on September 19. The figure was 0.4 cents up from yesterday’s average, 3.3 cents up from last week’s average, 8.2 cents up from last month’s average, and 0.4 cents down from last year’s average, GasBuddy’s website highlighted.

In a statement posted on the GasBuddy website on September 15, Patrick De Haan, head of petroleum analysis at GasBuddy, noted that “the transition to cheaper winter gasoline begins tomorrow [September 16] across most of the nation” and added that he expects average gas prices “will continue to decline in the weeks ahead in most states – assuming hurricane season remains quiet”.

The AAA Fuel Prices website describes itself as a public service of the United States of America’s largest motoring and leisure travel membership organization. GasBuddy states on its site that its mission is “to make fuel savings easier and more accessible for everyone”.

The EIA notes on its site that it “collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment”.

To contact the author, email [email protected]

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Observability platforms gain AI capabilities

LogicMonitor also announced Oracle Infrastructure (OCI) Monitoring to expand its multi-cloud coverage, provide visibility across AWS, Azure, GCP, and OCI, and offer observability capabilities across several cloud platforms. The company also made its LM Uptime and Dynamic Service Insights capabilities generally available to help enterprise IT organizations find issues sooner

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Cisco strengthens integrated IT/OT network and security controls

Another significant move that will help IT/OT integration is the planned integration of the management console for Cisco’s Catalyst and Meraki networks. That combination will allow IT and OT teams to see the same dashboard for industrial OT and IT enterprise/campus networks. Cyber Vision will feeds into the dashboard along

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NYK Increases CO2 Credits Purchase from Occidental

NYK Line has signed a deal to buy more carbon dioxide (CO2) removal credits from 1PointFive, Occidental Petroleum Corp’s carbon capture and storage business. The credits for the Japanese shipping company will be enabled by 1PointFive and BlackRock Inc’s Stratos direct air capture (DAC) project in Texas, on track to start operations this year, a joint statement said. This is NYK’s second agreement to buy CO2 removal credits from the project. “NYK is proactively driving decarbonization in the international shipping industry through a multifaceted approach that includes introducing fuel-efficient vessels, adopting low-carbon fuels such as biofuels and improving each vessel’s energy and operational efficiency”, commented NYK executive vice president Akira Kono. “Addressing the residual emissions that cannot be eliminated through operational or technological improvements alone requires CDR [carbon dioxide removal]”. 1PointFive president and general manager Anthony Cottone said the expanded partnership with NYK will help “demonstrate how direct air capture is uniquely positioned to deliver durable and verifiable carbon removal”. NYK already has an agreement with ENEOS Corp under which the fellow Japanese company will procure CO2 removal credits from the Texas project. “ENEOS will then sell these credits, along with the marine fuel it supplies, to NYK for five years starting in 2028”, NYK said in a press release December 18, 2024. The parties have not disclosed the volume of credits committed to NYK in the two Stratos agreements. 1PointFive expects Stratos, under construction in Ector County, to be the biggest DAC facility in the world with a capacity to capture up to 500,000 metric tons a year of CO2, to be stored in saline formations. The project has secured Class VI permits for CO2 sequestration. “The permits, the first issued to sequester CO2 from a DAC project, allow Occidental to leverage its expertise managing large quantities of CO2 while advancing

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USA Gasoline Price Projected to Drop Below $2.90 in 2026

In its latest short term energy outlook (STEO), which was released on September 9, the U.S. Energy Information Administration (EIA) projected that the U.S. regular gasoline retail price will average under $2.90 per gallon in 2026. According to that STEO, the EIA expects the U.S. regular gasoline retail price to come in at $2.86 per gallon next year. The STEO, which highlighted that the gasoline price averaged $3.31 per gallon in 2024, sees gasoline coming in at $3.09 per gallon in 2025. A quarterly breakdown included in the EIA’s latest STEO showed that the EIA expects the U.S. regular gasoline retail price to average $3.14 per gallon in the third quarter of this year, $2.96 per gallon in the fourth quarter, $2.73 per gallon in the first quarter of 2026, $2.89 per gallon in the second quarter, $2.99 per gallon in the third quarter, and $2.84 per gallon in the fourth quarter. The STEO pointed out that the U.S. regular retail gasoline price averaged $3.10 per gallon in the first quarter of 2025 and $3.16 per gallon in the second quarter. “Falling oil prices in our forecast lead to a drop in gasoline prices,” the EIA said in its latest STEO. “We expect the U.S. average retail price for regular grade gasoline will average about $3.10 per gallon this year, down 20 cents per gallon from last year,” it added. “Retail gasoline prices in our forecast fall to an average of $2.90 per gallon in 2026, with the annual average price falling below $3.00 per gallon in all regions except the West Coast,” it continued. In its latest gasoline fuel update, which was released on September 16, the EIA showed a declining trend in the U.S. regular gasoline price. That update highlighted that U.S. regular gasoline averaged $3.192 per gallon

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Melbana Starts Drilling New Cuban Production Well

Melbana Energy Ltd on Thursday began drilling the Amistad-2 production well onshore Cuba after delays. The campaign eyes a total measured depth of 1,125 meters (3,690.94 feet), the Sydney, Australia-based oil and gas company said in a statement on its website. Melbana previously said it would take about three weeks to reach the target depth. “The Unit 1A formation will be logged, but not tested, en route. A 650-metre MD section of the Unit 1B formation will be drilled to intersect a series of natural fracture systems interpreted from seismic”, the statement said. Melbana finally mobilized the rig last month after delays. “Several logistical challenges have been encountered in recent months in Cuba, in part due to hurricane damage impacting port operations, but these are now largely resolved and the scheduling impact absorbed into the new schedule”, it said in a stock filing August 21. “The widely reported power outages in Cuba are also impacting local communities and industry. As a result, Melbana’s preferred drilling rig was once again redirected to drill a gas well to provide fuel for additional electricity generation, thereby resulting in a delay to the scheduled spud date for Amistad-2”. Melbana plans to trial crude exports from Cuba by the end of the year, after stalling the trial earlier this year due to port issues. “More than 30,000 barrels of oil are now in storage”, it said in the filing last month. “Additional production from Amistad-2 would accelerate the rate of build in crude inventory, allowing for bigger cargoes more frequently”. “The impact of conflicts in other parts of the world on shipping rates also made the shipment of a relatively small cargo potentially uneconomic, which outweighed the advantages of testing the company’s operational and transactional plans for exporting oil and receiving payment”, Melbana added. “These

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EU Eyes Faster Russian LNG Phaseout

The European Union is planning measures to accelerate the bloc’s phaseout of Russian liquefied natural gas, just days after US President Donald Trump called on the EU to do more to curb Moscow’s energy trade.  The European Commission, the bloc’s executive arm, is considering including a provision in its new sanctions package to phase out imports of all Russian LNG earlier than the end of 2027, which was the EU’s initial plan, according to people familiar with the matter. The EU will propose its new sanctions as early as Friday, Bloomberg reported earlier. The EU is also weighing an option to push forward the elimination of Russian LNG imports through an amendment to the so-called RePowerEU plan to end reliance on energy from Moscow, said the people, who spoke on the condition of anonymity. “Since we presented the RePowerEU plan in 2022, we’ve been saying that a phaseout of Russian energy is better sooner rather than later,” Commission Spokeswoman Anna-Kaisa Itkonen said.  The Trump administration has called on Europe to accelerate its wind-down of Russian fuel imports at a faster rate and has pressured allies to impose tariffs as high as 100 percent on India and China for their purchases of Russian oil.   Trump has been calling on Europe to do more to target Russia’s energy revenue as a condition for ramping up its own pressure on Moscow.  Many EU countries are reluctant to hit India and China with tariffs, so the commission’s focus is turning to targeting Russian LNG, according to the people.  The global gas market is expected to start shifting into a surplus in the second half of next year, reducing the risk that the phaseout of Russian gas could put pressure on European supplies and lead to price spikes. This will be a key factor for the

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California Resources to Combine with Berry in All-Stock Deal

California Resources Corporation (CRC) and Berry Corporation said they have entered into a definitive agreement to combine in an all-stock transaction valuing Berry at approximately $717 million, inclusive of Berry’s net debt. Under the terms of the merger agreement, existing CRC shareholders are expected to own approximately 94 percent of the combined company upon closing, the two companies said in a joint statement. Berry shareholders will receive a fixed exchange ratio of 0.0718 shares of CRC common stock for each share of Berry common stock owned. The transaction will add oil-weighted, mostly conventional proved developed reserves and sustainable cash flow to CRC. On a pro forma basis, the combined company would have produced approximately 16,000 barrels of oil equivalent per day (boepd) consisting of 81 percent oil in the second quarter and would have held approximately 652 million barrels of oil equivalent (MMboe) proved reserves as of the end of 2024, according to the statement. The transaction is expected to close in the first quarter of 2026, subject to customary closing conditions, including receipt of required regulatory approvals and receipt of Berry shareholder approval. As a result of the combination, CRC will also own C&J Well Services, a California-focused oilfield services subsidiary of Berry. This business will enhance CRC’s ability to maintain active wells, strengthen its well abandonment capabilities, help support safe and responsible operations, mitigate future cost inflation and ensure long-term operational efficiency, the company said. CRC’s executive management team will lead the combined company from its headquarters in Long Beach, California, according to the statement. CRC plans to refinance Berry’s outstanding debt with cash on hand and borrowings under its credit agreement and may also pursue a new debt issuance to further optimize its balance sheet and support long-term capital allocation priorities, the statement said. “The combination of

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Union Says it Delivered ‘Wage Win’ for CNOOC Offshore Workers

In a statement sent to Rigzone by Unite on Thursday, the union announced that it had delivered a “wage win for CNOOC offshore workers”, adding that its “latest oil and gas industry success [is] worth up to GBP 8,000 ($10,897)”. The union confirmed in the statement that “around 130 workers have overwhelmingly backed a pay deal with offshore operator CNOOC”. It noted that the basic pay increase is worth 5.5 percent “with further improvements to allowances worth an additional seven per cent”. “The overall package is equivalent to an uplift amounting up to GBP 8,000 for members working on the Buzzard, Scott, and Golden Eagle platforms depending on their role,” Unite said in the statement. The union noted in the statement that the CNOOC workers include control room operators, supervisors, electricians, technicians, and mechanics. Unite added that the membership “had previously supported strike action after several offers were rejected by the workers”.  “Unite has successfully delivered its latest wage win for offshore workers, this time for those employed by CNOOC,” Unite General Secretary Sharon Graham said in the statement. “It’s a significant increase which only came about due to our members being prepared to take strike action to get a better deal,” Graham added. Unite industrial officer John Boland said in the statement, “Unite is pleased to secure a good pay deal for our CNOOC membership”. “We are putting millions of pounds directly into the pockets of highly skilled workers in the oil and gas industry. Unite does what it says on the tin: we deliver better jobs, pay, and conditions for offshore workers,” he added. Rigzone has contacted CNOOC Limited and CNOOC International for comment on Unite’s statement. At the time of writing, neither have responded to Rigzone. CNOOC International is the operator of Buzzard, Golden Eagle, and Scott, CNOOC International’s

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OpenAI and Oracle’s $300B Stargate Deal: Building AI’s National-Scale Infrastructure

Oracle’s ‘Astonishing’ Quarter Stuns Wall Street, Targeting Cloud Growth and Global Data Center Expansion Oracle’s FY Q1 2026 earnings report on September 9 — along with its massive cloud backlog — stunned Wall Street with its blow-out Q1 earnings. The market reacted positively to the huge growth in infrastructure revenue and performance obligations (RPO), a measure of future revenue from customer contracts, which indicates significant growth potential and Oracle’s increasing role in AI technology—even as earnings and revenue missed estimates. After the earnings announcement, Oracle stock soared more than 36%, marking its biggest daily gain since December 1992 and adding more than $250 billion in market value to the company. The company’s stock surge came even as the software giant’s earnings and lower-than-expected revenue. Leaders reported company’s RPO jumped about 360% in the quarter to $455 billion, indicating its potential growth and demand for its cloud services and infrastructure. As a result, Oracle CEO Safra Catz projects that its GPU‑heavy Oracle Cloud Infrastructure (OCI) business will grow 77% to $18 billion in its current fiscal year (2026) and soar to $144 billion in 2030. The earnings announcement also made Oracle’s Co-Founder, Chairman and CTO Larry Ellison the richest person in the world briefly, with shares of Oracle surging as much as 43%. By the end of the trading day, his wealth increased nearly $90 billion to $383 billion, just shy of Tesla CEO Elon Musk’s $384 billion fortune. Also on the earnings call, Ellison announced that in October at the Oracle AI World event, the company will introduce the Oracle AI Database OCI for customers to use the Large Language Model (LLM) of their choice—including Google’s Gemini, OpenAI’s ChatGPT, xAI’s Grok, etc.—directly on top of the Oracle Database to easily access and analyze all existing database data. Capital Expenditure Strategy These astonishing numbers are due

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Ethernet, InfiniBand, and Omni-Path battle for the AI-optimized data center

IEEE 802.3df-2024. The IEEE 802.3df-2024 standard, completed in February 2024 marked a watershed moment for AI data center networking. The 800 Gigabit Ethernet specification provides the foundation for next-generation AI clusters. It uan 8-lane parallel structure that enables flexible port configurations from a single 800GbE port: 2×400GbE, 4×200GbE or 8×100GbE depending on workload requirements. The standard maintains backward compatibility with existing 100Gb/s electrical and optical signaling. This protects existing infrastructure investments while enabling seamless migration paths. UEC 1.0. The Ultra Ethernet Consortium represents the industry’s most ambitious attempt to optimize Ethernet for AI workloads. The consortium released its UEC 1.0 specification in 2025, marking a critical milestone for AI networking. The specification introduces modern RDMA implementations, enhanced transport protocols and advanced congestion control mechanisms that eliminate the need for traditional lossless networks. UEC 1.0 enables packet spraying at the switch level with reordering at the NIC, delivering capabilities previously available only in proprietary systems The UEC specification also includes Link Level Retry (LLR) for lossless transmission without traditional Priority Flow Control, addressing one of Ethernet’s historical weaknesses versus InfiniBand.LLR operates at the link layer to detect and retransmit lost packets locally, avoiding expensive recovery mechanisms at higher layers. Packet Rate Improvement (PRI) with header compression reduces protocol overhead, while network probes provide real-time congestion visibility. InfiniBand extends architectural advantages to 800Gb/s InfiniBand emerged in the late 1990s as a high-performance interconnect designed specifically for server-to-server communication in data centers. Unlike Ethernet, which evolved from local area networking,InfiniBand was purpose-built for the demanding requirements of clustered computing. The technology provides lossless, ultra-low latency communication through hardware-based flow control and specialized network adapters. The technology’s key advantage lies in its credit-based flow control. Unlike Ethernet’s packet-based approach, InfiniBand prevents packet loss by ensuring receiving buffers have space before transmission begins. This eliminates

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Land and Expand: CleanArc Data Centers, Google, Duke Energy, Aligned’s ODATA, Fermi America

Land and Expand is a monthly feature at Data Center Frontier highlighting the latest data center development news, including new sites, land acquisitions and campus expansions. Here are some of the new and notable developments from hyperscale and colocation data center operators about which we’ve been reading lately. Caroline County, VA, Approves 650-Acre Data Center Campus from CleanArc Caroline County, Virginia, has approved redevelopment of the former Virginia Bazaar property in Ruther Glen into a 650-acre data center campus in partnership with CleanArc Data Centers Operating, LLC. On September 9, 2025, the Caroline County Board of Supervisors unanimously approved an economic development performance agreement with CleanArc to transform the long-vacant flea market site just off I-95. The agreement allows for the phased construction of three initial data center buildings, each measuring roughly 500,000 square feet, which CleanArc plans to lease to major operators. The project represents one of the county’s largest-ever private investments. While CleanArc has not released a final capital cost, county filings suggest the development could reach into the multi-billion-dollar range over its full buildout. Key provisions include: Local hiring: At least 50 permanent jobs at no less than 150% of the prevailing county wage. Revenue sharing: Caroline County will provide annual incentive grants equal to 25% of incremental tax revenue generated by the campus. Water stewardship: CleanArc is prohibited from using potable county water for data center cooling, requiring the developer to pursue alternative technologies such as non-potable sources, recycled water, or advanced liquid cooling systems. Local officials have emphasized the deal’s importance for diversifying the county’s tax base, while community observers will be watching closely to see which cooling strategies CleanArc adopts in order to comply with the water-use restrictions. Google to Build $10 Billion Data Center Campus in Arkansas Moses Tucker Partners, one of Arkansas’

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Hyperion and Alice & Bob Call on HPC Centers to Prepare Now for Early Fault-Tolerant Quantum Computing

As the data center industry continues to chase greater performance for AI and scientific workloads, a new joint report from Hyperion Research and Alice & Bob is urging high performance computing (HPC) centers to take immediate steps toward integrating early fault-tolerant quantum computing (eFTQC) into their infrastructure. The report, “Seizing Quantum’s Edge: Why and How HPC Should Prepare for eFTQC,” paints a clear picture: the next five years will demand hybrid HPC-quantum workflows if institutions want to stay at the forefront of computational science. According to the analysis, up to half of current HPC workloads at U.S. government research labs—Los Alamos National Laboratory, the National Energy Research Scientific Computing Center, and Department of Energy leadership computing facilities among them—could benefit from the speedups and efficiency gains of eFTQC. “Quantum technologies are a pivotal opportunity for the HPC community, offering the potential to significantly accelerate a wide range of critical science and engineering applications in the near-term,” said Bob Sorensen, Senior VP and Chief Analyst for Quantum Computing at Hyperion Research. “However, these machines won’t be plug-and-play, so HPC centers should begin preparing for integration now, ensuring they can influence system design and gain early operational expertise.” The HPC Bottleneck: Why Quantum is Urgent The report underscores a familiar challenge for the HPC community: classical performance gains have slowed as transistor sizes approach physical limits and energy efficiency becomes increasingly difficult to scale. Meanwhile, the threshold for useful quantum applications is drawing nearer. Advances in qubit stability and error correction, particularly Alice & Bob’s cat qubit technology, have compressed the resource requirements for algorithms like Shor’s by an estimated factor of 1,000. Within the next five years, the report projects that quantum computers with 100–1,000 logical qubits and logical error rates between 10⁻⁶ and 10⁻¹⁰ will accelerate applications across materials science, quantum

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Google Partners With Utilities to Ease AI Data Center Grid Strain

Transmission and Power Strategy These agreements build on Google’s growing set of strategies to manage electricity needs. In June of 2025, Google announced a deal with CTC Global to upgrade transmission lines with high-capacity composite conductors that increase throughput without requiring new towers. In July 2025, Google and Brookfield Asset Management unveiled a hydropower framework agreement worth up to $3 billion, designed to secure firm clean energy for data centers in PJM and Eastern markets. Alongside renewable deals, Google has signed nuclear supply agreements as well, most notably a landmark contract with Kairos Power for small modular reactor capacity. Each of these moves reflects Google’s effort to create more headroom on the grid while securing firm, carbon-free power. Workload Flexibility and Grid Innovation The demand-response strategy is uniquely suited to AI data centers because of workload diversity. Machine learning training runs can sometimes be paused or rescheduled, unlike latency-sensitive workloads. This flexibility allows Google to throttle certain compute-heavy processes in coordination with utilities. In practice, Google can preemptively pause or shift workloads when notified of peak events, ensuring critical services remain uninterrupted while still creating significant grid relief. Local Utility Impact For utilities like I&M and TVA, partnering with hyperscale customers has a dual benefit: stabilizing the grid while keeping large customers satisfied and growing within their service territories. It also signals to regulators and ratepayers that data centers, often criticized for their heavy energy footprint, can actively contribute to reliability. These agreements may help avoid contentious rate cases or delays in permitting new power plants. Policy, Interconnection Queues, and the Economics of Speed One of the biggest hurdles for data center development today is the long wait in interconnection queues. In regions like PJM Interconnection, developers often face waits of three to five years before new projects can connect

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Generators, Gas, and Grid Strategy: Inside Generac’s Data Center Play

A Strategic Leap Generac’s entry represents a strategic leap. Long established as a leader in residential, commercial, and industrial generation—particularly in the sub-2 megawatt range—the company has now expanded into mission-critical applications with new products spanning 2.2 to 3.5 megawatts. Navarro said the timing was deliberate, citing market constraints that have slowed hyperscale and colocation growth. “The current OEMs serving this market are actually limiting the ability to produce and to grow the data center market,” he noted. “Having another player … with enough capacity to compensate those shortfalls has been received very, very well.” While Generac isn’t seeking to reinvent the wheel, it is intent on differentiation. Customers, Navarro explained, want a good quality product, uneventful deployment, and a responsive support network. On top of those essentials, Generac is leveraging its ongoing transformation from generator manufacturer to energy technology company, a shift accelerated by a series of acquisitions in areas like telemetry, monitoring, and energy management. “We’ve made several acquisitions to move away from being just a generator manufacturer to actually being an energy technology company,” Navarro said. “So we are entering this space of energy efficiency, energy management—monitoring, telemetrics, everything that improves the experience and improves the usage of those generators and the energy management at sites.” That foundation positions Generac to meet the newest challenge reshaping backup generation: the rise of AI-centric workloads. Natural Gas Interest—and the Race to Shorter Lead Times As the industry looks beyond diesel, customer interest in natural gas generation is rising. Navarro acknowledged the shift, but noted that diesel still retains an edge. “We’ve seen an increase on gas requests,” he said. “But the power density of diesel is more convenient than gas today.” That tradeoff, however, could narrow. Navarro pointed to innovations such as industrial storage paired with gas units, which

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Microsoft will invest $80B in AI data centers in fiscal 2025

And Microsoft isn’t the only one that is ramping up its investments into AI-enabled data centers. Rival cloud service providers are all investing in either upgrading or opening new data centers to capture a larger chunk of business from developers and users of large language models (LLMs).  In a report published in October 2024, Bloomberg Intelligence estimated that demand for generative AI would push Microsoft, AWS, Google, Oracle, Meta, and Apple would between them devote $200 billion to capex in 2025, up from $110 billion in 2023. Microsoft is one of the biggest spenders, followed closely by Google and AWS, Bloomberg Intelligence said. Its estimate of Microsoft’s capital spending on AI, at $62.4 billion for calendar 2025, is lower than Smith’s claim that the company will invest $80 billion in the fiscal year to June 30, 2025. Both figures, though, are way higher than Microsoft’s 2020 capital expenditure of “just” $17.6 billion. The majority of the increased spending is tied to cloud services and the expansion of AI infrastructure needed to provide compute capacity for OpenAI workloads. Separately, last October Amazon CEO Andy Jassy said his company planned total capex spend of $75 billion in 2024 and even more in 2025, with much of it going to AWS, its cloud computing division.

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John Deere unveils more autonomous farm machines to address skill labor shortage

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More Self-driving tractors might be the path to self-driving cars. John Deere has revealed a new line of autonomous machines and tech across agriculture, construction and commercial landscaping. The Moline, Illinois-based John Deere has been in business for 187 years, yet it’s been a regular as a non-tech company showing off technology at the big tech trade show in Las Vegas and is back at CES 2025 with more autonomous tractors and other vehicles. This is not something we usually cover, but John Deere has a lot of data that is interesting in the big picture of tech. The message from the company is that there aren’t enough skilled farm laborers to do the work that its customers need. It’s been a challenge for most of the last two decades, said Jahmy Hindman, CTO at John Deere, in a briefing. Much of the tech will come this fall and after that. He noted that the average farmer in the U.S. is over 58 and works 12 to 18 hours a day to grow food for us. And he said the American Farm Bureau Federation estimates there are roughly 2.4 million farm jobs that need to be filled annually; and the agricultural work force continues to shrink. (This is my hint to the anti-immigration crowd). John Deere’s autonomous 9RX Tractor. Farmers can oversee it using an app. While each of these industries experiences their own set of challenges, a commonality across all is skilled labor availability. In construction, about 80% percent of contractors struggle to find skilled labor. And in commercial landscaping, 86% of landscaping business owners can’t find labor to fill open positions, he said. “They have to figure out how to do

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2025 playbook for enterprise AI success, from agents to evals

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More 2025 is poised to be a pivotal year for enterprise AI. The past year has seen rapid innovation, and this year will see the same. This has made it more critical than ever to revisit your AI strategy to stay competitive and create value for your customers. From scaling AI agents to optimizing costs, here are the five critical areas enterprises should prioritize for their AI strategy this year. 1. Agents: the next generation of automation AI agents are no longer theoretical. In 2025, they’re indispensable tools for enterprises looking to streamline operations and enhance customer interactions. Unlike traditional software, agents powered by large language models (LLMs) can make nuanced decisions, navigate complex multi-step tasks, and integrate seamlessly with tools and APIs. At the start of 2024, agents were not ready for prime time, making frustrating mistakes like hallucinating URLs. They started getting better as frontier large language models themselves improved. “Let me put it this way,” said Sam Witteveen, cofounder of Red Dragon, a company that develops agents for companies, and that recently reviewed the 48 agents it built last year. “Interestingly, the ones that we built at the start of the year, a lot of those worked way better at the end of the year just because the models got better.” Witteveen shared this in the video podcast we filmed to discuss these five big trends in detail. Models are getting better and hallucinating less, and they’re also being trained to do agentic tasks. Another feature that the model providers are researching is a way to use the LLM as a judge, and as models get cheaper (something we’ll cover below), companies can use three or more models to

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OpenAI’s red teaming innovations define new essentials for security leaders in the AI era

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More OpenAI has taken a more aggressive approach to red teaming than its AI competitors, demonstrating its security teams’ advanced capabilities in two areas: multi-step reinforcement and external red teaming. OpenAI recently released two papers that set a new competitive standard for improving the quality, reliability and safety of AI models in these two techniques and more. The first paper, “OpenAI’s Approach to External Red Teaming for AI Models and Systems,” reports that specialized teams outside the company have proven effective in uncovering vulnerabilities that might otherwise have made it into a released model because in-house testing techniques may have missed them. In the second paper, “Diverse and Effective Red Teaming with Auto-Generated Rewards and Multi-Step Reinforcement Learning,” OpenAI introduces an automated framework that relies on iterative reinforcement learning to generate a broad spectrum of novel, wide-ranging attacks. Going all-in on red teaming pays practical, competitive dividends It’s encouraging to see competitive intensity in red teaming growing among AI companies. When Anthropic released its AI red team guidelines in June of last year, it joined AI providers including Google, Microsoft, Nvidia, OpenAI, and even the U.S.’s National Institute of Standards and Technology (NIST), which all had released red teaming frameworks. Investing heavily in red teaming yields tangible benefits for security leaders in any organization. OpenAI’s paper on external red teaming provides a detailed analysis of how the company strives to create specialized external teams that include cybersecurity and subject matter experts. The goal is to see if knowledgeable external teams can defeat models’ security perimeters and find gaps in their security, biases and controls that prompt-based testing couldn’t find. What makes OpenAI’s recent papers noteworthy is how well they define using human-in-the-middle

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