COP21: A Challenge to Global Financial and Energy Markets

Landmark. Historic. A breakthrough. Those are some of the terms being used to describe the outcome of COP21, and for once, hyperbole seems appropriate. For the first time, nearly every country in the world has signed on to an accord that commits them to reduce greenhouse gas emissions. For the global financial and energy markets, it’s a strong signal to re-think investments in fossil fuels and double down their bets on zero-carbon energy sources. A few years back, all the major oil and gas companies had units working with renewables. As oil prices rose, those divisions— never very large—were phased out. Perhaps the combination of still-dropping oil prices and an international agreement to lower GHGs will cause the majors to make an equally historic pivot in their strategies.

John Howell, Editorial Director