Rising oil prices help IOCs transition
Oil companies will have more cash available to invest in alternative energy, but high-target valuations mean M&A may be minimal
The sharp rise in oil prices since November, fuelled by signs that demand is picking up again, is an opportunity for IOCs to continue pursuing investments in alternative energy, Andy Brogan, global oil & gas sector leader at consultancy EY, tells Transition Economist. “A high oil price can cause a number of positive things. IOCs can reduce their gearing, pay out dividends and have spare money to invest, including capital to allocate to alternative energies,” Brogan says. “It also has a beneficial impact on their ability to raise funds outside of their cashflow.” Brent crude prices rose to a 13-month high of $67.70/bl on 25 February, returning to pre-pandemic levels. Having taken a heavy
Also in this section
25 April 2024
Carbon capture rates forecast to rise steadily from end of decade, but policy tools to drive large-scale deployment have yet to take shape, according to DNV
23 April 2024
Europe must unlock cross-border CO₂ trade if it wants to build a viable CCS sector for the long term
16 April 2024
US and European oil majors snap up smaller players and look to accelerate development in a region deemed to possess all the key elements for successful CCUS deployment
15 April 2024
Demand for credits seen rising 20% this year despite issues around integrity and standardisation