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In January 2022, we released Managing Peak Oil which explored the implications of a “non-linear” energy transition scenario. This was related to the Inevitable Policy Response’s ‘Forecast Policies Scenario’, predicting oil demand continued to rise in the short term, before falling rapidly from the late-2020s onwards. These implications are even more relevant, given the supply shock mentioned above. Our report concluded that the best way to meet this need while maintaining value is to keep a conservative approach to long-term investment and address short-term demand with shale projects that can rapidly deliver new production. Managing Peak Oil saw significant media coverage, including being in the New York Times:

Building on our Absolute Impact series (first published in 2020) in 2022, we provided an update to our ‘Hallmarks of Paris Compliance’ and evolved our framework for assessing company emissions targets. Producing a relative ranking table of climate goals for fifteen (increased from ten profiles) of the largest oil and gas producers; alongside publishing for the first time a set of “Credibility Criteria”, to accompany the Hallmarks.  The report continued to warn that “Net Zero” targets alone are insufficient for companies to be aligned with Paris Agreement goals – they need absolute limits on future emissions that incorporate scope 3 emissions, with interim targets also set on an absolute basis.


A key new element of the Absolute Impact report was a greater focus on the credibility of companies’ approaches to emissions reductions. We highlighted the extent to which asset sales and reliance on emissions mitigation technologies can mislead and the degree to which company efforts contribute, or otherwise, to an absolute fall in global emissions levels.


Our direct engagement with Swiss Re management (the world’s second-largest reinsurer) in March 2022, along with other NGOs, provided the evidence base that lead to the enactment of a new policy for the sector which excludes insurance for most new oil and gas projects. This expresses an ambition that by 2025 half, and by 2030 all, of its oil and gas premiums will come from companies with credible Net Zero plans; and commits to develop an oil and gas policy for its treaty business by 2023.


In June 2022, we published Unburnable Carbon: Ten Years On, exploring the potential risk exposure for oil and gas assets. We found that over $1 trillion of oil & gas assets risk becoming stranded in a rapid transition scenario; the majority, some $600bn, currently held by listed companies. In absolute terms, this stranded asset risk is concentrated in the financial centres of New York, Moscow, London, and Toronto. The report questions the compatibility of these financial centres’ activity with stated climate goals – can a stock exchange credibly claim alignment with “Net Zero” if it continues to facilitate the activities of non-aligned corporates?


Our research was used by Natalie Bennett, (Member of House of Lords), in drafting the Energy (Oil and Gas) Profits Levy Bill in July 2022. We also provided significant input to GFANZ guidance for oil and gas companies, with substantial amendments to the draft document incorporating our narrative. Furthermore, the CFA Institute’s Certificate referenced two of our reports, using our stranded assets estimates in petrochemical facilities.


Another key output in 2022 was Crude Intentions, which built on previous work on remuneration and updated the message to focus on ‘transition positive’ metrics. This report led to several follow-up engagements, with potential collaborations into 2023.


To round off the year, Paris Maligned was published in December. This focused on the climate-alignment of upstream oil and gas companies, considering both production plans and the compatibility of potential investments with Paris-aligned climate scenarios. Building on previous reports in the ‘Two Degrees of Separation’ series (e.g. Breaking the Habit, Adapt to Survive). In focusing on alignment (rather than alignment and risk), the report narrative was simplified, and complemented the narrative from Managing Peak Oil. 

Looking Ahead to 2023

The OGM team is looking to expand our range of scenarios in 2023, including those which see increasingly rapid decline in oil and gas demand through the late 2020s into the 2030s (e.g. the Fast transition scenario from Oxford iNET). We shall also extend our private equity work to include geographies outside the US. To give greater coverage of the risks to oil and gas companies – and to investors exposed to them – we shall develop further analysis on downstream (we have had data challenges to date on this), midstream (LNG and pipelines), and coal mining. With increased focus on the implications for financial institutions (e.g. banks), in addition to those for asset owners and managers, as well as exploring potential to research impacts for debt investors (given existing equities focus).

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