THE LOOMING CLIMATE CHANGE THREAT TO BIG OIL
Big Oil’s Disruptive Climate Change; Oil majors face a real risk of stranded assets—and not just related to efforts to limit carbon emissions.
Liam Denning, May 6, 2015 (Wall Street Journal)
“Even as oil rallies back above $60 a barrel, obituaries are being drafted. Oil majors face questions from shareholders concerned the threat of climate change means some of the reserves underpinning the companies will never be produced…[This risk of stranded assets] is real…Saudi Arabia’s decision to keep pumping despite the drop in oil prices…indicated concern about long-term demand in the face of technological and regulatory threats…Citigroup estimates as much as 40% of the current investment cycle—about $1.4 trillion—may have gone into or be going into projects that struggle to generate acceptable returns at oil prices below $75 a barrel…Right now, Brent crude futures for the next five years average about $74 a barrel…” click here for more