This is a sponsored article from BNY Mellon Investment Management.
As climate change rises up the agenda, one obvious area of consideration is the energy sector, as fossil fuel-related emissions play a significant role in climate change.
While the specifics vary between each industry, we believe it is likely that a combination of policy and new technology will have a notable impact on the demand for oil and gas over the next few years, with the explicit aim of curbing catastrophic climate change. These policies might include carbon taxes, scrappage and banning vehicles with internal combustion engines, as well as efficiency subsidies.
Aside from purely financial projections, the consequences of climate change and potential remediation may also create other risks and difficulties for energy companies. These include physical risks from extreme weather events (made more likely by climate change), litigation risks as fossil-fuel giants come under pressure from activist groups, and reputational risk for being – in the eyes of many – the perpetrators of global warming.
The numerous ways in which fossil fuels are embedded in the world’s industries and products is complex, but we think it is probable that oil and gas will come under fire from policy within our investment time horizons, a reality that investors may want to consider.
Insights shared by:
Emma Mogford
Portfolio Manager
BNY Mellon Investment Management
Read more: https://bit.ly/2tEA8Cm
IMPORTANT INFORMATION:Not for further distribution. This is a financial promotion and is not investment advice. Any views and opinions are those of the investment manager, unless otherwise noted. The value of investment can fall. Investors may not get back the amount invested. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and its subsidiaries. In Hong Kong, the issuer of this document is BNY Mellon Investment Management Hong Kong Limited, which is registered with the Securities and Futures Commission (Central Entity Number: AQI762). BNY Mellon Investment Management Hong Kong Limited and any other BNY Mellon entity mentioned are ultimately owned by The Bank of New York Mellon Corporation. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and its subsidiaries. In Singapore this document is issued by BNY Mellon Investment Management Singapore Pte. Limited, Co. Reg. 201230427E. Regulated by the Monetary Authority of Singapore (MAS). This advertisement has not been reviewed by the Monetary Authority of Singapore. BNY Mellon Investment Management Hong Kong Limited and any other BNY Mellon entity(ies) mentioned are ultimately owned by The Bank of New York Mellon Corporation. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and its subsidiaries. If this document is used or distributed in Australia, it is issued by BNY Mellon Investment Management Australia Ltd (ABN 56 102 482 815, AFS License No. 227865) located at Level 2, 1 Bligh Street, Sydney, NSW 2000. MC211-12-10-2019(3m)
This is a sponsored article from BNY Mellon Investment Management.