Since the first UN COP (“Conference of the Parties”) meeting in 1995, world oil demand has increased from 64 to 100 million barrels per day. But even as demand increased, the “environmental, social and governance” (ESG) movement encouraged investors to unload their oil industry holdings. Faced with share valuations reflecting their perceived status as a “sunset Industry,” the rational course for oil company leaders was to pay out large dividends rather than reinvest in production growth. As demand grew, supply therefore stagnated. The Ukraine crisis revealed just how narrow the supply margin has become. Regrettably, most of that margin is in the hands of Vladimir Putin, leaving European countries that depend on Russian oil no choice but to continue to provide the funds with which he ravages the Ukrainian people. This is the tragedy sanctimonious ESG zealots have wrought.
Meanwhile, back in the world capital of “if you only believe” fantasies, the prime minister of a country endowed with one of the world’s largest reserves of oil has presided over a seven-year long anti-oil industry scourge, thwarting multiple proposed export pipelines that could now have been supplying those captive market countries.
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