C-MACC Weekly “CRETER” (Climate etc.)
Oil Companies – Buybacks/Chemicals Worth More Than CCS?
- As the oil companies print cash and post record annual earnings, not enough is being spent on energy transition: shareholders like this – activists hate it.
- Decarbonization projects with incentives have low returns; buybacks look more attractive on a risk-adjusted basis – so does M&A, in oil and gas and chemicals.
- The likely demise of lithium – hurt by its own high price and forecasts that prices will be high long-term – cheap batteries appear, and more investment arrives.
- We question the economics of Eastman’s PET molecular recycling plans and doubt that buyers will pay up – we are watching Origin’s start-up with interest.
- Otherwise, we look at bp’s self-serving review of world energy but agree with a natural gas conclusion, more irrational exuberance for wind/solar, and jobs.
See PDF below for all charts, tables and diagrams