Refinery

In the Paris climate agreement, world leaders committed to try to limit global warming to just 1.5 degrees Celsius, which would greatly reduce the risks of climate change.

For that to happen, the world must quickly decrease its use of fossil fuels. But oil and gas companies continue to invest in new projects.

Rob Schuwerk is with Carbon Tracker North America, a think tank that analyzes how the climate issue affects financial markets.

In a recent report, his group analyzed the oil and gas projects that already exist to determine whether these investments are compatible with the world’s climate goals.

The analysts found that current projects alone will push the world past the 1.5 degrees Celsius goal.

“The message from the 1.5-degree scenario is fairly stark and fairly simple,” Schuwerk says. “It’s essentially that we don’t need any new oil and gas projects at all, which is obviously not what’s going on today. Companies continue to spend a lot of capital on new projects.”

If the world decides not to burn that oil and gas, the companies will be unable to sell the fuel they’re planning to extract. Schuwerk says that poses a major financial risk to the companies and their investors.

“It’s certainly a very stark message for the industry,” he says.

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Reporting credit: ChavoBart Digital Media.

Topics: Policy & Politics