Tuesday, July 30, 2013

The Carbon Bubble and Disappearing Value

Burning all the carbon reserves currently in corporate and government hands would take atmospheric carbon dioxide levels way beyond what scientists consider safe. As a result, the powerful and deep-pocketed fuel lobby has a vested interest in convincing people that burning fossil fuel is unrelated to climate change. Indeed, companies like ExxonMobil (NYSE: XOM  ) spend a lot of money trying to discredit climate science in the public domain.

HSBC recently conducted an analysis that looked at European oil majors' at-risk carbon reserves. The study found Norway's Statoil (NYSE: STO  )  to be the worst affected, with approximately 17% of its market capitalization at risk. HSBC also calculated that 6% of BP's  (NYSE: BP  ) reserves are at risk, along with 5% of Total's (NYSE: TOT  ) and 2% of Shell's  (NYSE: RDS-A  ) . 

John Vechey of PopCap Games recently joined The Motley Fool for a climate change summit. His first panel guests were Dr. Rachel Cleetus, a climate economist with the Union of Concerned Scientists, and Dr. Joe Casola, the program director for science and impacts at the Center for Climate and Energy Solutions. They both offer insights in this video into what may be a looming carbon bubble.

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