The year 2020 marked a turning point in the Fossil Fuel Industry. Experts cautioned that approximately $900 billion in reserves—roughly one-third of the value of major oil and gas companies—were at risk of being useless in the face of a global pandemic, extreme market shocks, and a transition toward renewable energy.
Also Big Oil seemed to accept its fate, with Royal Dutch Shell (NYSE:RDS.A) CEO Ben van Beurden announcing that we had already reached peak oil production, and BP Plc. It is a business that increased its aggressive drilling immediately after the historic 2015 UN Climate Change Agreement—finally gave in and said, “concerns about carbon emissions and climate change mean that it is increasingly unlikely that the world’s reserves of oil will ever be exhausted.“
ExxonMobil (NYSE:XOM), BP Plc., Shell, Chevron (NYSE:CVX), Total (NYSE:TOT), and Eni S.p.A., according to Rystad, have proven oil and gas reserves that are declining as produced quantities are not being completely replaced by new Discoveries. Last year, massive impairment charges caused Big Oil’s proven reserves to drop by 13 billion boe, or 15% of its stock levels in the field. Unless Big Oil makes more commercial Discoveries rapidly, Rystad estimates that the remaining reserves will be depleted in less than 15 years.