Turner Commodities Law, PLLC
6353 Richmond Avenue, Suite 122
Houston, Texas 77057
(713) 899-5027
paul.turner@turnercommoditieslaw.com
2
Procedural Whiplash: Litigation, Withdrawal, and Regulatory Suspension
After consolidation in the Eighth Circuit and an initial stay, the SEC reversed course in March 2025
and notified the court it would no longer defend the Rule. Importantly, the SEC did not withdraw the
Rule did not initiate repeal and did not declare it unenforceable.
This placed the Rule in an administratively incoherent posture. Under the Administrative Procedure
Act, a duly promulgated rule can be repealed only through a new notice-and-comment process non-
enforcement alone does not nullify it. Courts likewise avoid deciding the legality of a rule an agency
refuses to defend.
The Eighth Circuit held the litigation in abeyance — indefinitely. See Order, Iowa v. SEC, No. 24-
1522 (8th Cir. Sept. 12, 2025). As of now, the Rule has not been repealed, amended, or vacated the
SEC has not resumed defense and litigation remains paused. The Rule is legally effective but
practically dormant.
Implications for Energy Traders and Corporates Navigating ESG Shifts
The trading sector is encountering a divided landscape. On the one hand, banks, insurers, European
counterparties, and multinational corporates continue tightening climate-risk expectations. On the
other, some U.S. companies have begun scaling back public ESG commitments and reducing visibility
of climate-related programs in response to the current political environment. In such an environment,
what we should expect:
1. Counterparty expectations will be uneven — particularly for energy commodity traders dealing
in crude oil, refined products, LNG, or natural gas, where European buyers or California-linked
entities increasingly demand upstream and downstream emissions data.
2. Companies lowering ESG visibility externally often continue the substance internally.
3. Regulatory reactivation could outpace corporate repositioning.
4. Capital markets still expect climate-risk transparency.
Take-aways and Recommendations
• Maintain a lean but durable climate-risk governance spine— including basic tracking of material
physical and transition risks in commodity portfolios (e.g., stranded asset exposure in high-
carbon fuels).
• Document what you already do.
6353 Richmond Avenue, Suite 122
Houston, Texas 77057
(713) 899-5027
paul.turner@turnercommoditieslaw.com
2
Procedural Whiplash: Litigation, Withdrawal, and Regulatory Suspension
After consolidation in the Eighth Circuit and an initial stay, the SEC reversed course in March 2025
and notified the court it would no longer defend the Rule. Importantly, the SEC did not withdraw the
Rule did not initiate repeal and did not declare it unenforceable.
This placed the Rule in an administratively incoherent posture. Under the Administrative Procedure
Act, a duly promulgated rule can be repealed only through a new notice-and-comment process non-
enforcement alone does not nullify it. Courts likewise avoid deciding the legality of a rule an agency
refuses to defend.
The Eighth Circuit held the litigation in abeyance — indefinitely. See Order, Iowa v. SEC, No. 24-
1522 (8th Cir. Sept. 12, 2025). As of now, the Rule has not been repealed, amended, or vacated the
SEC has not resumed defense and litigation remains paused. The Rule is legally effective but
practically dormant.
Implications for Energy Traders and Corporates Navigating ESG Shifts
The trading sector is encountering a divided landscape. On the one hand, banks, insurers, European
counterparties, and multinational corporates continue tightening climate-risk expectations. On the
other, some U.S. companies have begun scaling back public ESG commitments and reducing visibility
of climate-related programs in response to the current political environment. In such an environment,
what we should expect:
1. Counterparty expectations will be uneven — particularly for energy commodity traders dealing
in crude oil, refined products, LNG, or natural gas, where European buyers or California-linked
entities increasingly demand upstream and downstream emissions data.
2. Companies lowering ESG visibility externally often continue the substance internally.
3. Regulatory reactivation could outpace corporate repositioning.
4. Capital markets still expect climate-risk transparency.
Take-aways and Recommendations
• Maintain a lean but durable climate-risk governance spine— including basic tracking of material
physical and transition risks in commodity portfolios (e.g., stranded asset exposure in high-
carbon fuels).
• Document what you already do.
