Stranded fossil-fuel assets translate into major losses for investors in advanced economies
Authors
Semieniuk, Gregor
Holden, Philip
Mercure, Jean-Francois
Salas, Pablo
Pollitt, Hector
Jobson, Katharine
Vercoulen, Pim
Chewpreecha, Unnada
Edwards, Neil
Vinuales, Jorge
Publication Date
2022-06Journal Title
Nature Climate Change
ISSN
1758-678X
Publisher
Nature Research
Volume
12
Issue
6
Pages
532-538
Language
en
Type
Article
This Version
VoR
Metadata
Show full item recordCitation
Semieniuk, G., Holden, P., Mercure, J., Salas, P., Pollitt, H., Jobson, K., Vercoulen, P., et al. (2022). Stranded fossil-fuel assets translate into major losses for investors in advanced economies. Nature Climate Change, 12 (6), 532-538. https://doi.org/10.1038/s41558-022-01356-y
Abstract
The distribution of ownership of transition risk associated with stranded fossil-fuel assets remains poorly understood. We calculate that global stranded assets as present value of future lost profits in the upstream oil and gas sector exceed US$1 trillion under plausible changes in expectations about the effects of climate policy. We trace the equity risk ownership from 43,439 oil and gas production assets through a global equity network of 1.8 million companies to their ultimate owners. Most of the market risk falls on private investors, overwhelmingly in OECD countries, including substantial exposure through pension funds and financial markets. The ownership distribution reveals an international net transfer of more than 15% of global stranded asset risk to OECD-based investors. Rich country stakeholders therefore have a major stake in how the transition in oil and gas production is managed, both as ongoing supporters of the fossil-fuel economy and potentially exposed owners of stranded assets.
Keywords
Article, /706/4066/4098, /704/106/694/682, /706/689/159, article
Sponsorship
NERC (via Open University) (AMS-724409 CLS-380-25)
Identifiers
s41558-022-01356-y, 1356
External DOI: https://doi.org/10.1038/s41558-022-01356-y
This record's URL: https://www.repository.cam.ac.uk/handle/1810/338208
Rights
Licence:
http://creativecommons.org/licenses/by/4.0/
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