Is Big Oil Coming Around On Climate Change?

A recent New York Times article seems to call into question the assumption that the oil industry will always be opposed to any attempts to implement climate change legislation.

Historically, the most aggressive opponents of green energy solutions and public policy aimed at curbing climate change have been oil companies, particularly the biggest firms such as ExxonMobil and Shell. In addition, Koch Industries, owned by Charles and David Koch, has been a major sponsor of advocacy groups that seek to undermine any legislative attempt to tax greenhouse gas emissions.

However, a recent New York Times article seems to call into question the assumption that the oil industry will always be opposed to any attempts to implement climate change legislation. The Times reports that five of the biggest oil companies, as well as many corporations outside the energy industry such as Microsoft and Google, have begun to factor into their financial projects the prospect of a carbon tax, as a way of hedging against a future in which the U.S. Congress actually passes climate legislation.

"It's climate change as a line item," Tom Carnac, North American president of the Carbon Disclosure Project, told the source. "They're looking at it from a rational perspective, making a profit. It drives internal decision-making."

Koch Industries, which has funded many campaigns to unseat lawmakers who support climate legislation, remains a strong opponent of such efforts and in some ways has pitted itself against the rest of the oil industry. But the article speculates that the other firms could eventually come around to support efforts at mitigating the effects of global warming, such as carbon taxing or cap-and-trade.

Does this mean that Big Oil has suddenly become altruistic? Not exactly. The main goal of these financial plans seems to be maintaining supremacy in the industry rather than making the world a cleaner, safer place. Additionally, it should be noted that these companies have received a lot of pressure from investors and regulators to revisit the evidence on global warming and assess their position in a world where temperatures rise, ice caps melt and widespread destruction of coast lines threatens world security. As noted in a recent piece by UK news source The Guardian, these companies are finally hearing criticism from the only people whose opinions they truly care about: Shareholders.

"Companies across the economy and institutional investors are among those recognizing the need to transition from fossil fuels to cleaner energy sources," notes The Guardian. "As part of this effort, 70 global investors with collective assets totaling $3 trillion made the first ever joint request to the world's 45 largest oil, coal and power companies… to assess the financial risks that climate change and these other trends pose to your business plans."

It's going to take many years to reverse the effects of decades of lobbying and investment on behalf of climate skepticism, however. According to Pew Research, only 40 percent of Americans believe that climate change is a major threat, much lower than the percentages of Europeans and Latin American residents who believe it is a significant concern. Convincing the public of something that they have long been told to disbelieve is going to require extended, vigorous efforts on the part of all stakeholders, including Big Oil.

However, the fact that oil companies are finally coming around on climate change, even if it's cynically motivated, is a spark of positive news from an industry that has had such a negative influence on world events over the last several decades.

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