Two Economies Collide - Competition, Conflict, and the Financial Case for Fossil Fuel Divestment

The Long-Term Financial Performance of the Fossil Fuel Sector Has Been Weak and the Short-Term Outlook is Unsustainable For decades, the fossil fuel sector powered the growth of the world economy. [...] With the price collapse in 2014 and the subsequent decline in the industry in 2019, ExxonMobil— the last of the oil and gas companies in the top 10 of the S&P 500—lost its position.1 Recent price spikes have pushed both its stock price up and the prices of the entire industry. [...] Many companies had no choice 8 For a lengthy discussion of the growth of the fracking technology and the inability of the industry to construct a business model to ensure profitability see: Daniel Yergin, The New Map. [...] The IEA, acknowledging the projected decline in use of fossil fuels for electricity and transport, found that most of the increased demand for oil and gas in the future will be for petrochemicals (ammonia, fertilizer, packaging, construction, textiles and appliance components).37 The petrochemical business is not one industry. [...] According to the CCS Institute, 20 of the 27 commercially operating CCS facilities in the world are enhanced oil recovery projects.50 Shute Creek is also one of the oldest and largest facilities, making ExxonMobil the industry leader in the field.