All in Oil
As the world moves towards carbon neutrality, Sumaya Yusuf discusses the precarious state of Big Oil as it struggles to both appease shareholders and balance its engagement in a lucrative hydrocarbon market with diversifying towards renewable energy.
Oil is facing unprecedented challenges as the decade begins. Confronted by inevitable financial decline; the increased importance of Environmental, Social and Corporate Governance (ESG) for asset managers and investment funds; and the growing risk of climate-related litigation. The big players will have to respond to these challenges creatively and consolidate their positions at the forefront of energy production. However, Big Tech promises to be a crucial rival in yet another industry, meaning the situation may look very different in the next decade.
ESG investment has boomed during the global pandemic, and the energy industry is facing a huge shift. With oil prices falling, Gulf and Middle-Eastern States are loading up on debt, while the big players in the market are announcing different investment priorities. Green bonds meanwhile show that effective regulation can lead to improvements in this area.
