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On Friday, during the show “Squawk Box,” CNBC Market Analyst Jim Cramer compared oil and other fossil fuel stocks to “the stigma attached to investing in tobacco companies” as shares of both Chevron and Exxon both fell in early trading Friday after announcing quarterly results. According to Cramer, young people’s views are having an impact — “This has to do with new kinds of money managers who frankly just want to appease younger people,” Cramer said. “We’re starting to see divestment all over the world.” And from the Big Ten to the Ivy League, universities are becoming a focus of divestment efforts — student leaders from across the Big Ten Conference last weekend called on their institutions to begin divesting from fossil fuels, representing 500,000 undergraduate students across 14 institutions.
Why This Matters: We are reaching a point where a consensus of public opinion — particularly young people who are pressuring their elders to change — is that fossil fuel stocks are bad investments, not just bad for their impact on climate change. When BlackRock announced its intention to divest, that was a huge signal to investors that its time to change strategies and put investment dollars into more sustainable businesses. And these big fossil fuel companies are not performing financially — missing their earnings targets is bound to dampen investor enthusiasm and may even trigger more sell-offs. Not to mention the increasing success of divestment efforts to generate bad publicity for holding onto fossil fuel stocks.
Poor Performance By Oil and Gas
One of the issues is that fossil fuel companies are not diversifying their energy portfolios fast enough and their stocks are losing value. Both Chevron missed revenue expectations, as well as Exxon’s lower earnings per share came in below what analysts expected. One of the biggest problems is the glut of oil and gas on the market today causing consistently low prices for oil and natural gas. However, CNBC’s Cramer also explained that even if oil and gas companies hit their numbers, he thinks the stocks will not turn around.
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by Amy Lupica, ODP Staff Writer In February, the governors of Pennsylvania, New York, New Jersey, and Delaware voted unanimously to ban fracking in the Delaware River Basin, but Republican-led lawsuits are seeking to stop this action. The ban prevented the natural gas industry from blasting up to 4,000 wells in the basin, serving a blow to the […]
Electric vehicles are an important part of meeting climate change action goals in addition to their potential to clean up air pollution, yet Americans have traditionally been apprehensive about purchasing them. That is until now. As Ben Geman wrote for Axios this week, “Even as gasoline-powered sales return from the pandemic, cars with plugs are […]
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