The reentry of the United States into the Paris Agreement on climate change and announcements from China and Japan on net-zero emissions goals have restored hope in efforts to limit global temperature rise to less than 2 degrees Celsius above pre-industrial levels. This, along with the rapid fall in the cost of renewable energy, suggests lower prices and lower profits for the oil and gas industry over the next few decades.
After many years of recalcitrance, some oil companies may be getting the message, increasing their focus on renewable energy sources and writing off assets that won’t produce profits if the world really does stop burning so much oil and gas. Much has been said about the decisions by BP, Total, and Shell—the names that dominate pension funds and roadside service stations—to write down portions of their oil and gas portfolios and increase their investment in renewable technologies.
