Benzinga - by Neil Dennis, Benzinga Staff Writer.
This year’s United Nations Climate Change Conference, or COP28, kicked off on Thursday in Dubai.
Nations expressed renewed commitments to reduce their reliance on fossil fuels — deemed a moment of reckoning for oil companies.
COP28 President and UAE leader Sultan Al Jaber said at the opening plenary on Thursday: “Let history reflect the fact that this is the Presidency that made a bold choice to proactively engage with oil and gas companies. We had many hard discussions. Let me tell you, it wasn’t easy.”
Over the next 12 days, agendas are packed with seminars and discussions on decarbonizing industry, renewable energy, how new technologies will be leveraged to combat climate change and many other topics designed to send shivers down the spines of fossil fuel producers and their investors.
But in reality, will anything have changed for oil and gas-producing nations and companies after this event?
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Share Prices Remain Unmoved
On Thursday, Chevron (NYSE:CVX) was up 0.8%; Exxon Mobil (NYSE:XOM) added 0.7%; and ConocoPhillips (NYSE:COP) gained 0.7% — all more or less in line with the price of oil — with Brent crude up 1.1% and Nymex WTI up 1%. The United States Oil Fund (USO), an exchange-traded fund that tracks the price of light sweet crude, gained 1.3%.
Al Jaber is the chief executive of the UAE’s Abu Dhabi National Oil Company. He was at the center of recent controversy over claims he’d been briefed to advance the interests of the businesses he leads at the summit.
“Sultan Al Jaber claims his inside knowledge of the fossil fuel industry qualifies him to lead a crucial climate summit but it looks ever more like a fox is guarding the hen house,” said Ann Harrison, climate advisor to Amnesty International.
Investment In Carbon Capture
“We expect CCS to have commodity-like margin in the medium to long term. Therefore, we continue to view CCS technology and engineering and construction (EPC) companies as the near-term beneficiaries of potential growth,” said Victoria McCulloch, analyst at RBC Capital Markets.
Among the companies favored by RBC were California Resources Corp (NYSE:CRC), Baker Hughes (NYSE:BKR) and ExxonMobil (NYSE:XOM) — which, in the past few years, has striven to be seen as a net-zero crusader, with a new deal on its methane emissions and plans to start lithium production for EV batteries.
Among the exchange-traded funds tracking the carbon capture industry are: KraneShares Global Carbon Strategy ETF (KRBN), VanEck Low Carbon Energy ETF (SMOG) and iShares MSCI ACWI Low Carbon Target ETF (CRBN).
Now Read: 6 Stocks To Watch As The World Turns To The 2023 UN Climate Change Conference
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