Get ONMINE

Stay Ahead, Stay ONMINE

Trade War May Hold Down Oil Demand, Price Drop to Provide Some Offset: IEA

Current market conditions suggest global oil demand would average 103.9 million barrels per day (MMbpd) this year, with growth prospects weighed down by United States tariffs, the International Energy Agency (IEA) said Thursday. That still represents an increase of just over 1 MMbpd, compared to last year’s growth of 830,000 bpd, with lower prices expected […]

Current market conditions suggest global oil demand would average 103.9 million barrels per day (MMbpd) this year, with growth prospects weighed down by United States tariffs, the International Energy Agency (IEA) said Thursday.

That still represents an increase of just over 1 MMbpd, compared to last year’s growth of 830,000 bpd, with lower prices expected to provide some offset against a trade war-induced decline, according to the intergovernmental body’s monthly oil market report.

On the other hand, supply is already rising even before the Organization of the Petroleum Exporting Countries and its ally producers unwind production cuts, leading to a surplus, the IEA said.

“The macroeconomic conditions that underpin our oil demand projections deteriorated over the past month as trade tensions escalated between the United States and several other countries”, the Paris-based IEA said in a statement. “New US tariffs, combined with escalating retaliatory measures, tilted macro risks to the downside.

“Recent oil demand data have underwhelmed, and growth estimates for 4Q24 [fourth quarter 2024] and 1Q25 have been marginally downgraded to around 1.2 mb/d [million barrels a day], with data for both advanced and developing markets coming in below projections”.

“Proposed US tariffs on Canada and Mexico, set to take effect on 1 April, may impact flows and prices from the two countries that accounted for roughly 70 percent of US crude oil imports last year”, the IEA added.

“Meanwhile, the latest round of sanctions on Russia and Iran has yet to significantly disrupt loadings, even as some buyers have scaled back purchases”.

Against the backdrop of escalating trade tensions and OPEC Plus’ plans to start restoring production rates, benchmark crude prices fell by about $7 a barrel in February and early March, the IEA noted. Over the past eight weeks Brent futures declined by $11 per barrel, it said.

The weakening of prices will support a demand growth of which Asia would account for nearly 60 percent, according to the IEA. Asian gains would be led by China, “where petrochemical feedstocks will provide the entirety of growth as demand for refined fuels reaches a plateau”, it said.

“Risks to the market outlook remain rife and uncertainties abound”, the IEA said. “Our current balances suggest global oil supply may exceed demand by around 600 kb/d [thousand barrels a day] this year.

“If OPEC+ extends the unwinding of output cuts beyond April without reining in supply from members currently overproducing versus their targets, another 400 kb/d could be added to the market.

“Equally, the scope and scale of tariffs remain unclear, and with trade negotiations continuing apace, it is still too early to assess the impact on the market outlook”.

To contact the author, email [email protected]

What do you think? We’d love to hear from you, join the conversation on the

Rigzone Energy Network.

The Rigzone Energy Network is a new social experience created for you and all energy professionals to Speak Up about our industry, share knowledge, connect with peers and industry insiders and engage in a professional community that will empower your career in energy.


MORE FROM THIS AUTHOR

Shape
Shape
Stay Ahead

Explore More Insights

More Articles

Stay ahead with more perspectives on cutting-edge power, infrastructure, energy,  bitcoin and AI solutions. Explore these articles to uncover strategies and insights shaping the future of industries.

Shape

EPA to end environmental justice programs, monitoring tools

Dive Brief: The Trump administration announced Wednesday it will shut down all environmental justice offices and officially end other EJ-related initiatives, a move that will impact how waste and recycling industries measure and track their environmental impact on neighboring communities. The closures include the EPA’s Office of Environmental Justice and

Read More »

Intel under Tan: What enterprise IT buyers need to know

Intel’s discrete GPU ambitions — especially in enterprise AI — have often appeared reactive rather than part of a clear strategic vision. The company entered the market late, facing Nvidia’s dominant CUDA ecosystem and AMD’s aggressive push into AI GPUs. “Tan’s background suggests he is unlikely to double down on

Read More »

SUSE expands AI tools to control workloads, LLM usage

“And every few weeks we’ll continue to add to the library,” Puri says. SUSE also announced a partnership with Infosys today. The system integrator has the Topaz AI platform, which includes a set of services and solutions to help enterprises build and deploy AI applications. SUSE is also integrating the

Read More »

D-Wave uses quantum to solve real-world problem

D-Wave published its results today, peer-reviewed in the journal Science. The classical supercomputer that D-Wave benchmarked against was the Frontier supercomputer at the Department of Energy’s Oak Ridge National Laboratory. It was, until recently, the most powerful supercomputer in the world but moved to second place in November. Two different

Read More »

Kentucky Power customers pay for AEP transmission without benefit, state officials say in complaint

Dive Brief: Kentucky Power ratepayers are paying for transmission built by other American Electric Power utilities that don’t benefit them, the Kentucky Public Service Commission and Kentucky Attorney General said in a complaint filed Wednesday with federal regulators. Kentucky Power customers have paid at least $75 million since 2019 for transmission built in six other states under a cost allocation framework between AEP utilities, according to the complaint filed with the Federal Energy Regulatory Commission. “AEP self-planned transmission projects outside of the Kentucky Power service territory cannot be shown to be sufficiently connected to serving Kentucky Power customers to allocate costs for far-flung transmission projects geared to serve the customers of other AEP retail distribution companies,” the PSC and attorney general said in the complaint. They contend AEP underinvests in Kentucky’s transmission system. Dive Insight: Kentucky Power, an AEP subsidiary, “strongly disagrees” with the claims in the complaint and has shown in previous FERC proceedings that its customers benefit from transmission investments in Kentucky and the PJM region, Kentucky Power President Cindy Wiseman said in a press release. “A strong transmission grid provides our customers and communities with increased reliability and access to low-cost generation resources,” Wiseman said. The costs for transmission projects that are “self-planned” by AEP utilities in the PJM region are shared by the utilities under an agreement established in 1984 and modified last in 2009, according to the complaint. AEP utilities subject to the agreement are Appalachian Power, Columbus Southern Power, Indiana Michigan Power, Kentucky Power, Kingsport Power, Ohio Power and Wheeling Power. AEP transmission companies that are part of the pact are AEP Appalachian Transmission, AEP Indiana Michigan Transmission, AEP Kentucky Transmission, AEP Ohio Transmission and AEP West Virginia Transmission. The Kentucky PSC reviews proposed transmission projects in its state to ensure that they cost-effectively

Read More »

EPA Says it is Initiating ’31 Historic Actions’

In a video posted on the U.S. Environmental Protection Agency’s (EPA) site this week, EPA Administrator Lee Zeldin said the EPA “is initiating 31 historic actions”. “I’m pleased to make the largest deregulatory announcement in U.S. history,” Zeldin said in the video. “The Environmental Protection Agency is initiating 31 historic actions to fulfil President Trump’s promise to unleash American energy, revitalize our auto industry, restore the rule of law, and give power back to the states,” he added. Combined, these announcements represent the most momentous day in the history of the EPA, the organization said in a statement posted on its site, which accompanied the video. It added that, “as a result of these announcements, the cost of living for American families will decrease” and said “these actions will create American jobs”. The actions include a “reconsideration of regulations throttling the oil and gas industry”, a “reconsideration of [the] mandatory Greenhouse Gas Reporting Program”, and a “reconsideration of regulations on power plants”, the statement highlighted. “While accomplishing EPA’s core mission of protecting the environment, the agency is committed to fulfilling President Trump’s promise to unleash American energy, lower cost of living for Americans, revitalize the American auto industry, restore the rule of law, and give power back to states to make their own decisions,” the EPA said in the statement. In a statement posted on the American Petroleum Institute (API) website, API President and CEO Mike Sommers said, “voters sent a clear message in support of affordable, reliable and secure American energy, and the Trump administration is answering the call by moving forward on many of the priorities in API’s five-point policy roadmap”. “As this regulatory process moves forward, we are committed to working with Administrator Zeldin on commonsense policies that advance American energy dominance,” he added. In a statement sent

Read More »

Trade War May Hold Down Oil Demand, Price Drop to Provide Some Offset: IEA

Current market conditions suggest global oil demand would average 103.9 million barrels per day (MMbpd) this year, with growth prospects weighed down by United States tariffs, the International Energy Agency (IEA) said Thursday. That still represents an increase of just over 1 MMbpd, compared to last year’s growth of 830,000 bpd, with lower prices expected to provide some offset against a trade war-induced decline, according to the intergovernmental body’s monthly oil market report. On the other hand, supply is already rising even before the Organization of the Petroleum Exporting Countries and its ally producers unwind production cuts, leading to a surplus, the IEA said. “The macroeconomic conditions that underpin our oil demand projections deteriorated over the past month as trade tensions escalated between the United States and several other countries”, the Paris-based IEA said in a statement. “New US tariffs, combined with escalating retaliatory measures, tilted macro risks to the downside. “Recent oil demand data have underwhelmed, and growth estimates for 4Q24 [fourth quarter 2024] and 1Q25 have been marginally downgraded to around 1.2 mb/d [million barrels a day], with data for both advanced and developing markets coming in below projections”. “Proposed US tariffs on Canada and Mexico, set to take effect on 1 April, may impact flows and prices from the two countries that accounted for roughly 70 percent of US crude oil imports last year”, the IEA added. “Meanwhile, the latest round of sanctions on Russia and Iran has yet to significantly disrupt loadings, even as some buyers have scaled back purchases”. Against the backdrop of escalating trade tensions and OPEC Plus’ plans to start restoring production rates, benchmark crude prices fell by about $7 a barrel in February and early March, the IEA noted. Over the past eight weeks Brent futures declined by $11 per barrel, it said.

Read More »

FIRST-NNPC JV Confirms Significant Hydrocarbon Discovery

A statement posted on FIRST Exploration & Petroleum Development Company Limited’s (FIRST E&P) website recently announced that the company’s joint venture with Nigerian National Petroleum Company Limited (NNPC Limited) has “confirmed a significant hydrocarbon discovery in the Songhai field, located in OML 85 in the shallow offshore region of Bayelsa”. The well was spudded on November 18, 2024, as part of efforts to increase and sustain the JV’s oil production over the next five years, the statement noted, adding that it was “successfully drilled to a total depth of 8,883 feet Measured Depth in 30 meters of water”. The well encountered hydrocarbons across eight reservoirs, logging over 1,000 feet of hydrocarbon-bearing sands, most of which exhibit excellent reservoir properties, the statement said. “Preliminary analysis indicates substantial oil and gas volumes, reinforcing the field’s commercial potential,” the statement noted.   “Further evaluations, including formation testing and well data integration, will be conducted to refine resource estimates and optimize field development plans,” it added. Segun Owolabi, General Manager, Exploration and Development at FIRST E&P, said in the statement, “this discovery marks a major milestone in our efforts to unlock the full potential of our assets”. “The success at Songhai Field underscores the effectiveness of our exploration strategy and our commitment to delivering sustainable value to all stakeholders,” Owolabi added. Seyi Omotowa, Chief Upstream Investment Officer of NUIMS at NNPC, said in the statement, “this aligns with NNPC Limited’s mandate to drive production growth and cost optimization”. “The success at Songhai Field reflects our commitment to strategic partnerships, advanced technology, and efficient operations to maximize Nigeria’s hydrocarbon potential sustainably”. NNPC Limited’s Group Chief Executive Officer, Mallam Mele Kyari, said in the statement, “this discovery reaffirms the potential of Nigeria’s offshore assets and the importance of collaboration in boosting reserves and production”.  “NNPC Limited

Read More »

Aramco Oil Sales to China Set to Fall Sharply in April

Saudi Aramco is set to supply the lowest amount of oil to China in several months, even as the OPEC+ cartel gears up to boost output. The state-owned Saudi Arabian major will send 34 million to 36 million barrels of April-loading crude to customers in China, the world’s biggest importer, according to data compiled by Bloomberg. That compares with 41 million for March, and a figure below 36 million would be the smallest since at least the first half of last year. Aramco’s monthly sales to Asia, and in particular to China, are an important source of supply for many refiners across the region. The volume of the shipments, which are sold only via long-term contracts, determines how much crude these processors will need to buy on the spot market from producers including Iraq, the United Arab Emirates and West Africa. The latest official selling prices offered by Aramco were lower than expected in a Bloomberg survey. At present, it’s unclear if the drop in sales is due to lower requests for cargoes from Chinese customers, or a reduction in supply from the kingdom. The decline in the Saudi volumes comes as the Organization of the Petroleum Exporting Countries and its allies aim to restore output from next month, kicking off the first of what could be a long series of modest supply increases. That move – coupled with wider concerns about the potential impact on energy demand from the US-led trade war – have weighed on crude futures. Three other refiners outside of China said they received all of the crude that they had requested. Aramco’s press office didn’t respond to an email seeking comment. What do you think? We’d love to hear from you, join the conversation on the Rigzone Energy Network. The Rigzone Energy Network is a new social experience

Read More »

Uniper Makes Nearly $3B Bailout-Related Payment to Germany

Uniper SE said Thursday it had remitted to Germany about EUR 2.6 billion ($2.82 billion) in aid repayments in relation to the government’s bail-out of the power and natural gas utility in 2022. Last year Uniper allotted a provisional EUR 3.4 billion to compensate the state for keeping the Düsseldorf-based company afloat during the gas crisis following Russia’s invasion of Ukraine. The amount was subject to Uniper’s 2024 performance. “In the 2024 consolidated financial statements, the amount of these repayment obligations to the Federal Republic of Germany was determined to be around EUR 2.6 billion, which were settled in full on 11 March 2025”, Uniper said in an online statement. Uniper chief financial officer Jutta Dönges commented, “Uniper has fulfilled an important condition in connection with the stabilization [bail-out] in 2022”. “It is proof that Uniper is financially stronger after the crisis and is operating profitably”, Dönges added. “We have learnt the right lessons from the crisis and are well equipped to make our contribution to a secure energy supply”. After winning arbitration against Gazprom PJSC in 2024 for undelivered gas, Uniper paid Germany EUR 530 million in September using part of claims realized from the ruling’s award of EUR 13 billion in damages, according to Uniper’s report of yearly results February 25, 2025. For 2024 it logged EUR 221 million in net profit and EUR 1.6 billion in adjusted net profit, sharply down from EUR 6.34 billion and EUR 4.43 billion, respectively, for 2023. In 2022, when Germany bailed out Uniper, it recorded a net loss of EUR 19.14 billion (-EUR 7.4 billion after adjustments). Adjusted earnings before income, taxes, depreciation and amortization (EBITDA) totaled EUR 2.61 billion for 2024, compared to EUR 7.16 billion for the prior year and -EUR 10.12 billion for 2022. Uniper attributed the huge drop in

Read More »

IBM laying foundation for mainframe as ultimate AI server

“It will truly change what customers are able to do with AI,” Stowell said. IBM’s mainframe processors The next generation of processors is expected to continue a long history of generation-to-generation improvements, IBM stated in a new white paper on AI and the mainframe. “They are projected to clock in at 5.5 GHz. and include ten 36 MB level 2 caches. They’ll feature built-in low-latency data processing for accelerated I/O as well as a completely redesigned cache and chip-interconnection infrastructure for more on-chip cache and compute capacity,” IBM wrote.  Today’s mainframes also have extensions and accelerators that integrate with the core systems. These specialized add-ons are designed to enable the adoption of technologies such as Java, cloud and AI by accelerating computing paradigms that are essential for high-volume, low-latency transaction processing, IBM wrote.  “The next crop of AI accelerators are expected to be significantly enhanced—with each accelerator designed to deliver 4 times more compute power, reaching 24 trillion operations per second (TOPS),” IBM wrote. “The I/O and cache improvements will enable even faster processing and analysis of large amounts of data and consolidation of workloads running across multiple servers, for savings in data center space and power costs. And the new accelerators will provide increased capacity to enable additional transaction clock time to perform enhanced in-transaction AI inferencing.” In addition, the next generation of the accelerator architecture is expected to be more efficient for AI tasks. “Unlike standard CPUs, the chip architecture will have a simpler layout, designed to send data directly from one compute engine, and use a range of lower- precision numeric formats. These enhancements are expected to make running AI models more energy efficient and far less memory intensive. As a result, mainframe users can leverage much more complex AI models and perform AI inferencing at a greater scale

Read More »

VergeIO enhances VergeFabric network virtualization offering

VergeIO is not, however, using an off-the-shelf version of KVM. Rather, it is using what Crump referred to as a heavily modified KVM hypervisor base, with significant proprietary enhancements while still maintaining connections to the open-source community. VergeIO’s deployment profile is currently 70% on premises and about 30% via bare-metal service providers, with a particularly strong following among cloud service providers that host applications for their customers. The software requires direct hardware access due to its low-level integration with physical resources. “Since November of 2023, the normal number one customer we’re attracting right now is guys that have had a heart attack when they got their VMware renewal license,” Crump said. “The more of the stack you own, the better our story becomes.” A 2024 report from Data Center Intelligence Group (DCIG) identified VergeOS as one of the top 5 alternatives to VMware. “VergeIO starts by installing VergeOS on bare metal servers,” the report stated. “It then brings the servers’ hardware resources under its management, catalogs these resources, and makes them available to VMs. By directly accessing and managing the server’s hardware resources, it optimizes them in ways other hypervisors often cannot.” Advanced networking features in VergeFabric VergeFabric is the networking component within the VergeOS ecosystem, providing software-defined networking capabilities as an integrated service rather than as a separate virtual machine or application.

Read More »

Podcast: On the Frontier of Modular Edge AI Data Centers with Flexnode’s Andrew Lindsey

The modular data center industry is undergoing a seismic shift in the age of AI, and few are as deeply embedded in this transformation as Andrew Lindsey, Co-Founder and CEO of Flexnode. In a recent episode of the Data Center Frontier Show podcast, Lindsey joined Editor-in-Chief Matt Vincent and Senior Editor David Chernicoff to discuss the evolution of modular data centers, the growing demand for high-density liquid-cooled solutions, and the industry factors driving this momentum. A Background Rooted in Innovation Lindsey’s career has been defined by the intersection of technology and the built environment. Prior to launching Flexnode, he worked at Alpha Corporation, a top 100 engineering and construction management firm founded by his father in 1979. His early career involved spearheading technology adoption within the firm, with a focus on high-security infrastructure for both government and private clients. Recognizing a massive opportunity in the data center space, Lindsey saw a need for an innovative approach to infrastructure deployment. “The construction industry is relatively uninnovative,” he explained, citing a McKinsey study that ranked construction as the second least-digitized industry—just above fishing and wildlife, which remains deliberately undigitized. Given the billions of square feet of data center infrastructure required in a relatively short timeframe, Lindsey set out to streamline and modernize the process. Founded four years ago, Flexnode delivers modular data centers with a fully integrated approach, handling everything from site selection to design, engineering, manufacturing, deployment, operations, and even end-of-life decommissioning. Their core mission is to provide an “easy button” for high-density computing solutions, including cloud and dedicated GPU infrastructure, allowing faster and more efficient deployment of modular data centers. The Rising Momentum for Modular Data Centers As Vincent noted, Data Center Frontier has closely tracked the increasing traction of modular infrastructure. Lindsey has been at the forefront of this

Read More »

Last Energy to Deploy 30 Microreactors in Texas for Data Centers

As the demand for data center power surges in Texas, nuclear startup Last Energy has now announced plans to build 30 microreactors in the state’s Haskell County near the Dallas-Fort Worth Metroplex. The reactors will serve a growing customer base of data center operators in the region looking for reliable, carbon-free energy. The plan marks Last Energy’s largest project to date and a significant step in advancing modular nuclear power as a viable solution for high-density computing infrastructure. Meeting the Looming Power Demands of Texas Data Centers Texas is already home to over 340 data centers, with significant expansion underway. Google is increasing its data center footprint in Dallas, while OpenAI’s Stargate has announced plans for a new facility in Abilene, just an hour south of Last Energy’s planned site. The company notes the Dallas-Fort Worth metro area alone is projected to require an additional 43 gigawatts of power in the coming years, far surpassing current grid capacity. To help remediate, Last Energy has secured a 200+ acre site in Haskell County, approximately three and a half hours west of Dallas. The company has also filed for a grid connection with ERCOT, with plans to deliver power via a mix of private wire and grid transmission. Additionally, Last Energy has begun pre-application engagement with the U.S. Nuclear Regulatory Commission (NRC) for an Early Site Permit, a key step in securing regulatory approval. According to Last Energy CEO Bret Kugelmass, the company’s modular approach is designed to bring nuclear energy online faster than traditional projects. “Nuclear power is the most effective way to meet Texas’ growing energy demand, but it needs to be deployed faster and at scale,” Kugelmass said. “Our microreactors are designed to be plug-and-play, enabling data center operators to bypass the constraints of an overloaded grid.” Scaling Nuclear for

Read More »

Data Center Jobs: Engineering and Technician Jobs Available in Major Markets

Each month Data Center Frontier, in partnership with Pkaza, posts some of the hottest data center career opportunities in the market. Here’s a look at some of the latest data center jobs posted on the Data Center Frontier jobs board, powered by Pkaza Critical Facilities Recruiting.  Data Center Facility Engineer (Night Shift Available) Ashburn, VAThis position is also available in: Tacoma, WA (Nights), Days/Nights: Needham, MA and New York City, NY. This opportunity is working directly with a leading mission-critical data center developer / wholesaler / colo provider. This firm provides data center solutions custom-fit to the requirements of their client’s mission-critical operational facilities. They provide reliability of mission-critical facilities for many of the world’s largest organizations facilities supporting enterprise clients and hyperscale companies. This opportunity provides a career-growth minded role with exciting projects with leading-edge technology and innovation as well as competitive salaries and benefits. Electrical Commissioning Engineer New Albany, OHThis traveling position is also available in: Somerset, NJ; Boydton, VA; Richmond, VA; Ashburn, VA; Charlotte, NC; Atlanta, GA; Hampton, GA; Fayetteville, GA; Des Moines, IA; San Jose, CA; Portland, OR; St Louis, MO; Phoenix, AZ;  Dallas, TX;  Chicago, IL; or Toronto, ON. *** ALSO looking for a LEAD EE and ME CxA agents.*** Our client is an engineering design and commissioning company that has a national footprint and specializes in MEP critical facilities design. They provide design, commissioning, consulting and management expertise in the critical facilities space. They have a mindset to provide reliability, energy efficiency, sustainable design and LEED expertise when providing these consulting services for enterprise, colocation and hyperscale companies. This career-growth minded opportunity offers exciting projects with leading-edge technology and innovation as well as competitive salaries and benefits. Switchgear Field Service Technician – Critical Facilities Nationwide TravelThis position is also available in: Charlotte, NC; Atlanta, GA; Dallas,

Read More »

Amid Shifting Regional Data Center Policies, Iron Mountain and DC Blox Both Expand in Virginia’s Henrico County

The dynamic landscape of data center developments in Maryland and Virginia exemplify the intricate balance between fostering technological growth and addressing community and environmental concerns. Data center developers in this region find themselves both in the crosshairs of groups worried about the environment and other groups looking to drive economic growth. In some cases, the groups are different components of the same organizations, such as local governments. For data center development, meeting the needs of these competing interests often means walking a none-too-stable tightrope. Rapid Government Action Encourages Growth In May 2024, Maryland demonstrated its commitment to attracting data center investments by enacting the Critical Infrastructure Streamlining Act. This legislation provides a clear framework for the use of emergency backup power generation, addressing previous regulatory challenges that a few months earlier had hindered projects like Aligned Data Centers’ proposed 264-megawatt campus in Frederick County, causing Aligned to pull out of the project. However, just days after the Act was signed by the governor, Aligned reiterated its plans to move forward with development in Maryland.  With the Quantum Loop and the related data center development making Frederick County a focal point for a balanced approach, the industry is paying careful attention to the pace of development and the relations between developers, communities and the government. In September of 2024, Frederick County Executive Jessica Fitzwater revealed draft legislation that would potentially restrict where in the county data centers could be built. The legislation was based on information found in the Frederick County Data Centers Workgroup’s final report. Those bills would update existing regulations and create a floating zone for Critical Digital Infrastructure and place specific requirements on siting data centers. Statewide, a cautious approach to environmental and community impacts statewide has been deemed important. In January 2025, legislators introduced SB116,  a bill

Read More »

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.

Read More »

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

Read More »

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

Read More »

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

Read More »
More Articles