As global economic activity picks up, oil prices are going up. The boom could be a mirage as governments finally get their act together on climate change, and it could lead to financial ruin if Big Oil ends up chasing it.
If the industry tries to wring more oil and gas out of the ground, it could end up with more than $500 billion in stranded assets, according to a new report. Let's not even start on the damage to the climate.
Dollar signs with high prices are clearly seen by the industry. If they go ahead with projects which deliver oil around the time that demand starts to decline, it would be a nightmare scenario, according to the report.
The end of the fossil fuel era needs to start soon for world leaders. If not, the consequences could be catastrophic. The report found that if governments start to wind down the fossil fuel industry, it could leave oil companies and shareholders holding the bag.
As the world transitions away from oil and gas, companies run the risk of destroying significant value as a result of failing to deliver the expected return results, said Mike Coffin, co-author of the report.
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