The little music sung by the largest oil and gas groups on the European continent evokes the tune of the Pied Piper of Hamelin: the United States and its historic economic liberalism would be, unlike Europe, the promised land of industries fossils. At the beginning of April, the former CEO of Shell stated in the Financial Times that the Anglo-Dutch giant would be “massively undervalued” on the London Stock Exchange, and would benefit from migrating to the United States. “In Europe, everything is slow”, echoed the CEO of TotalEnergies on April 29, before a committee of inquiry in the Senate, to justify his desire to leave the Paris Stock Exchange.
In the Anglo-Saxon economic press, Patrick Pouyanné said he was considering a listing in New York. HAS Bloomberg, he explains that the market supports his strategy of remaining a “major player in oil and gas”, while investing “5 billion dollars per year” in low-carbon energies and renewables. Before the Senate in France, he drives home the point: “When the demand for oil declines, we will decline with it.” Understand: his group can only move towards renewables very slowly – and not forcefully, as Europe would like.
Would shareholders on the other side of the Atlantic be less concerned about the future of the planet and the effect of global warming on the economy? By definition, shareholders, whether French, English or American, hate uncertainty, which prevents them from imagining tomorrow’s dividends. Looking ahead to the energy market today is “become very difficult, as the world moves towards cleaner energy sources”, REMARK The New York Times. The third American pension fund, the New York State Common Retirement Fund, understands this well. He announced last week “reduce investments in Exxon and other fossil fuel companies”. To the American daily, he explains “that future policies will most likely hurt the profits of companies that are not prepared for the transition.”
The argument of the omniscient stock market facing European regulators who restrict the activity of oil and gas groups is also hackneyed. A study just published by the Institute of Energy Economics and Financial Analysis (IEEFA), an American think tank, reveals that “Investments in oil, gas and coal have underperformed the broader stock market over the past ten years, explain Forbes. While portfolios that avoided investments in fossil fuels saw better returns.” This calls into question the idea that fossil fuel stocks are safe bets.
“Climate risk is a financial risk, and few sectors illustrate this better than fossil fuels,” summarizes Connor Chung, associate researcher at IEEFA. In 2023, the Center on Global Energy Policy at Columbia University also observed that “Oil and gas companies have underperformed the S&P 500, investors’ benchmark index, over the long term,” note it New York Times.
The Biden presidency, in the United States – which has invested massively in the transition – and Europe, with its Green Deal, are not playing against the markets, wherever they are, but for clean energy. The CEO of Total can always claim that financing his oil projects allows him to initiate the transition. We suggest he find other arguments to convince.
In short
Deadly floods in Kenya
After episodes of intense drought, the heavy rainfall which has been falling over East Africa for several weeks has had dramatic consequences. And Kenya is counting its deaths (more than 150 as of April 30) and its missing, due to landslides and floods. In the south of the country, “most of the victims drowned while trying to cross rivers and streams,” explain Nation. The Kenyan daily criticizes “lack of preparation [du pays] in the face of natural disasters”, which is manifested by “a shocking failure to secure people, their homes and public institutions, including schools and infrastructure like roads and bridges.”
World wine production at its lowest
In 2023, global wine production fell by 10% to 237.3 million hectoliters, the lowest figure since 1961, reports the magazine Forbes. France is the only wine-producing country where production is (slightly) increasing (+4%). Italy and Spain, on the other hand, “recorded very significant drops in production” (respectively − 23% and − 21%). This is due to extreme climatic conditions, which sometimes caused heavy rains and floods, sometimes episodes of drought and fires – not to mention an increase in vine diseases. Wine growers are all the more struggling as consumption is also on a downward trend (−2.6%), underlines Forbes.
When submarines become undetectable
With increasing surface water temperatures and ocean salinity linked to climate change, submarines will be much more difficult to detect by sonars, according to a new study. This will be particularly true in the eastern North Atlantic, in “areas regularly frequented by Russian and NATO submarines”, note New Scientist. In 2100, devices located between 200 and 300 meters deep will no longer be detectable more than 20 kilometers away from the transmitting military vessel, whereas they are today within a radius of up to 60 kilometers.
Bumblebees, champions of adaptation
Bumblebee queens have an unusual ability to survive being submerged for a week while hibernating, according to a study published in Biology Letters. This discovery gives us hope that these major allies of biodiversity will be able to adapt to climate change, reports the Canadian newspaper. The Globe and Mail. Especially since queens who hibernate buried in the ground would not be affected by winter rains or spring storms which are likely to increase.
To reread
Unknown elementNext week, your Climate newsletter takes the cake. See you on May 16.
