Tighter government climate regulations by 2025 could wipe up to $2.3 trillion off the value of companies in industries ranging from fossil fuel producers to agriculture and carmakers, an investor group warned in a report.
Rules aimed at lowering carbon emissions are expected to accelerate in the coming years as countries scramble to meet obligations under the 2015 Paris climate agreement limiting global warming.
Any abrupt policy shifts risk severely disrupting current investment strategies, U.N.-backed Principles of Responsible Investing (PRI), a group representing investors with $86 trillion of assets under management, said in a report.
“As the realities of climate change catch up, social pressure mounts, and low carbon solutions get cheaper, it’s highly improbable that governments will be allowed to let the world sleep-walk into greater rises in temperature without being compelled into forceful action sooner,” PRI Chief Executive Fiona Reynolds said.
“This poses huge threats for assets and for the wider system.”
Most exposed is the fossil fuel sector which could lose one-third of its current value, the report said. Fossil fuels account for around two-thirds of global greenhouse gas emissions.
Coal firms could lose as much as 44% in value, while the world’s top oil and gas companies risk losing up to 31% of their current market share, according to the report which forecasts oil demand peaking around 2027.
The analysis showed that broad index-based funds such as the iShares MSCI ACWI ETF could lose up to 4.5% or $2.3 trillion in its value under the most extreme scenario.
The shift would nevertheless also lead to winners.
Automakers heavily invested in electric vehicles and electric utility firms using low-carbon power could more than double their values, the report said.
The report came out as world leaders meet in Madrid for the 2019 United Nations climate change conference, known as COP25.
Read rest at Reuters
Meanwhile, global wealth redistribution creates more Chinese BILLIONAIRE$. Good luck getting them to pay “Climate reparations”. China is one way only.
The fossil fuel sector isn’t alone in what the climate change movement would do to its value. As I have said before, the company I work is just barely making it. We sell electronic equipment to commercial fishermen. A huge, huge cost of commercial fishing is fuel. If the price of fuel goes up substantially, the fishermen won’t have the money to buy electronic equipment. There are many, many thousands of companies that would be forced out business by higher energy costs.
Fortunately this isn’t likely to happen contrary to what the article says. It article assumes there is going to be forcing to lower carbon emissions and make fossil fuel much more expensive. That would be a reverse of the current trend of emissions going up year after year. It talks about as “social pressure mounts.” What we have seen is as climate change forces energy costs up, there is push back from those that have to pay for those costs. The yellow vest moment is one example. The election results in Australia is another.
The anti fossil fuel idiots need to feel what its like without the use of any fossil fuels they need to know about many of their everyday products they use has to do with Fossil Fuels and just let them live in a grass hut all winter long without any heat of any kind the kind of lesson they wont ever get from some liberal collage or school course jsut how soon would these useful iidots would change their minds if they had to live that way
Wars have been started over this sort of foolishness, and this one would be for control of the world, so expect a lot of pushback. Green Fascists will not be tolerated by those nations being driven to starvation and genocide by their draconian demands to stop BREATHING.
Enviromentalisms become a radical pagan new age religion that calls for the sacrifice of skeptics just like in the movie THE WICKER MAN put all skeptics into a giant wicker figure and then set it on fire so they can make the seasonal sacrifice for their false god