Rough week for the super majors
ROYAL DUTCH SHELL
Milieudefensie, the Dutch arm of the Friends of the Earth environmental organization, together with 17 thousand citizens had sued Shell for its climate damaging activities—and won. The verdict implies that Shell has to reduce its 2030 carbon emissions with 45 percent compared to 2019.
NOTABLE: I fully expect Shell to file an appeal
Chevron Corp shareholders on Wednesday voted in favor of a proposal to cut emissions generated by the use of the company’s products, a move that underscores growing investor push at energy companies to reduce their carbon footprint.
Shareholders voted 61% in favor of the proposal to cut so called “Scope 3” emissions, according to a preliminary count announced by Chevron at its annual general meeting.
Although the proposal does not require Chevron to set a target of how much it needs to cut emissions or by when, the overwhelming support for it shows growing investor frustration with companies, which, they believe, are not doing enough to tackle climate change, via Reuters.
Exxon Mobil’s shareholders have voted to replace at least two of the company’s 12 board members with members that were assumed better suited for fighting climate change. Exxon said that because of the complexities of the voting process, inspectors might not be able to certify final voting results for “some period of time.” It was unclear whether one additional board member was also unseated in the shareholder vote.
NOTABLE: I loved Exxon Mobil for sticking to their core business of oil as an investment over the next 5-10 years, I will be keeping a close watch on this company. Two of twelve is still a minority on the board, I am not certain how much they will be able to accomplish. Exxon has moved to my caution list. OVERALL NOTABLE: This is actually super bullish oil price longer term, and the likely beneficiaries will be mid to smaller tier players, as oil demand is not going away anytime soon. These companies will be forced to make up for output that is lost from the super majors. A good way to play this is the SPDR S&P Oil & Gas Exploration & Production ETF (XOP).
Energy and Materials Strategist
Hedge Fund Telemetry
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Disclaimer: I hold a long positions in Exxon Mobil (XOM) and Royal Dutch Shell (RDS)