Newsletters | Request Trial | Log in | Advertise | Digital Issue   |   Search
  • Upstream
  • Midstream & Downstream
  • Gas & LNG
  • Trading & Markets
  • Corporate & Finance
  • Geopolitics
  • Podcasts
Search
Related Articles
Difficult times for Germany’s downstream
Europe’s refining sector is desperately trying to adapt to a shifting global energy landscape and nowhere is this more apparent than in its largest economy
Global oil benchmark resolves its existential crisis
The addition of US crude to the world’s top oil benchmark has finally solved its North Sea conundrum and laid down a marker for the future
Oil and gas now has green licence
The hydrocarbons industry must start to deliver in 2024 on the quiet approvals granted at last year’s COP, which was also dubbed ‘Conference of the Petrostates’
Innovation accelerates drive to sustainability
For Earth Day we focus on the headway made in recent years to improve sustainability and consider future challenges
Oil trading’s biggest bust – MG: The death spiral and aftermath
Kevin O’Reilly concludes the cautionary tale of the German conglomerate’s overreach with what went very, very wrong
Oil trading’s biggest bust – MG: Enter Arthur Benson
Kevin O’Reilly continues his three-part account of the hobbling of a German industrial giant with the arrival of the story’s central figure
Oil trading’s biggest bust – MG: What started to go wrong?
Kevin O’Reilly, with 27 years commodity trading experience, dives into one of the most compelling tales of how not to hedge your risks in the first of a three-part series
Chinese energy demand gets back on track
The signs point towards a comeback in 2023, but uncertainty around Covid remains a factor
Arrow flies against Colombian headwinds
The company does not seem concerned about the effect on its growth plans of the new government’s proposed oil sector reforms, and is even looking at potential acquisitions
US oil output to set new record
Partisan political rhetoric has not prevented production growth
Renewables Oil markets
James Mills
4 October 2019
Follow @PetroleumEcon
Forward article link
Share PDF with colleagues

Capital costs rise on sustainability concerns

An intensifying investor focus on sustainable investing and the climate emergency is impacting the oil and gas sector

Investors are increasingly focused on the threat of global warming and the need to rapidly decarbonise the global economy, with up to $118tn of funds committed to making climate risk disclosures by 2020.   And they are responding by divesting oil and gas holdings, or, at a minimum, fully integrating sustainability into their investment process, driving an incrementally negative view of the sector.  Consequently, the sector's weighted average cost of capital (WACC) has risen, causing a valuation derating, reduced capital availability and low market liquidity.  Devaluation This negative increase in the industry WACC occurs in several ways.  Firstly, capital flows out of the sector as new issua

Also in this section
Trump’s energy report card
11 August 2025
The administration is pushing for deregulation and streamline permitting for natural gas, while tightening requirements and stripping away subsidies from renewables
OPEC+ off-target in July
8 August 2025
The producers’ group missed its output increase target for the month and may soon face a critical test of its strategy
The great OPEC+ reset
7 August 2025
The quick, unified and decisive strategy to return all the barrels from the hefty tranche of cuts from the eight producers involved in voluntary curbs signals a shift and sets the tone for the path ahead
Latest EU sanctions largely toothless
7 August 2025
Without US backing, the EU’s newest sanctions package against Russia—though not painless—is unlikely to have a significant impact on the country’s oil and gas revenues or its broader economy

Share PDF with colleagues

Rich Text Editor, message-text
Editor toolbarsBasic Styles Bold ItalicParagraph Insert/Remove Numbered List Insert/Remove Bulleted List Decrease Indent Increase IndentLinks Link Unlinkabout About CKEditor
COPYRIGHT NOTICE: PDF sharing is permitted internally for Petroleum Economist Gold Members only. Usage of this PDF is restricted by <%= If(IsLoggedIn, User.CompanyName, "")%>’s agreement with Petroleum Economist – exceeding the terms of your licence by forwarding outside of the company or placing on any external network is considered a breach of copyright. Such instances are punishable by fines of up to US$1,500 per infringement
Send

Forward article Link

Rich Text Editor, txt-link-message
Editor toolbarsBasic Styles Bold ItalicParagraph Insert/Remove Numbered List Insert/Remove Bulleted List Decrease Indent Increase IndentLinks Link Unlinkabout About CKEditor
Send
Sign Up For Our Newsletter
Project Data
Maps
Podcasts
Social Links
Featured Video
Home
  • About us
  • Subscribe
  • Reaching your audience
  • PE Store
  • Terms and conditions
  • Contact us
  • Privacy statement
  • Cookies
  • Sitemap
All material subject to strictly enforced copyright laws © 2025 The Petroleum Economist Ltd
Cookie Settings
;

Search

  • Upstream
  • Midstream & Downstream
  • Gas & LNG
  • Trading & Markets
  • Corporate & Finance
  • Geopolitics
  • Podcasts
Search