To understand our future, just watch what is happening right now at Exxon with activist shareholders pushing to replace board members. Yeah sure Engine No1 is a minor shareholder but Blackrock is a major shareholder supporting the push. All driven by transition to alternative energy that provides a few percent of need at best on a warm sunny day with lots of wind. Chevron’s present strategy is oil price will eventually skyrocket to before demand wanes and the world becomes “green”. In essence hold the course and be ready to pounce when demand >> supply. Activists are very effectively challenging that at Exxon. The same is coming for us. The marketplace is demanding change. Nice article in WSJ today walking readers through this harsh reality. The referendum on our c-suite leadership is already begun.
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Remember that right now oil prices would be in the toilet if not for the cooperation of Saudi Arabia and Russia to restrict production. If Iran is freed of sanctions they could triple their production and drive prices down. That said, it's entirely possible, if not probable, that sometime this decade (probably later in the decade) we'll see a spike in oil prices due to the lack of investment the last 6 years, and the inability of renewables to substitute for decreasing worldwide oil and gas production (mainly US by regulation and Russia by aging fields). The upside scenarios, however, will allow the current Chevron management to feather their retirement nest eggs quite nicely and retire on a high-note, and get their portraits hung on the wall in San Ramon. MW should be able to maintain the dividend illusion to his normal retirement age (in 2025, I believe), he'll then retire and leave the burden of reducing the dividend to probably the first minority woman CEO of Chevron.
Exxon and Shell have received all the headlines the past couple days, but Chevron's stockholder meeting was anything but a success. Shareholder initiatives, which used to be voted down by significant margins, are now creeping up close to the 50% threshold - one did pass this year, but expect the accountants to 'cook the books' to assure compliance - for the time being. Expect the 2022 meeting to be the first one Chevron management 'loses', with activist Board members replacing the current geriatric set, who have done little over the past decade other than pocketing their $250,000 fees. I sure do wish I received $20k for every meeting I attended!
The Chevron resolution was stupid because 1) it applies to the consumption/combustion by purchasers of Chevron oil and gas which is out of our control and 2) it set no actual goals.
At the recent Chevron annual meeting on Wednesday, a shareholder resolution that would force the company to cut its Scope 3 emissions (greenhouse gases released by the use the oil, gas and other products it sells) passed with 61% of the vote.
Wednesday was a bad day for Chevron, Exxon Mobil and Shell with Big Oil suffering historic blows on climate. A rude awakening that things will definitely be a changing.
At the recent Chevron annual meeting on Wednesday, a shareholder resolution that would force the company to cut its Scope 3 emissions (greenhouse gases released by the use the oil, gas and other products it sells) passed with 61% of the vote.
Wednesday was a bad day for Chevron, Exxon Mobil and Shell with Big Oil suffering historic blows on climate. A rude awakening that things will definitely be a changing.
Exxon's problem is their return on investment is less than 2% for last five years and they made multiple mistakes like Russia, Permian and XTO investment. They plan for 15 year cycle so taking 5Y snapshot for ROI is a bit unfair.
We have done similar mistakes but in a better position than exxon because we did not spend as much and we did not take that much debt. Good decision by MW not to get into that sinkholw. So it may be another couple of years before someone knocks on our door, by that time investor sentiment may change.
Bring it! Can't wait for Oil prices to head to the moon and take in that sweet cash! Job security is back baby!
The market is being told what to think by activists focused on a false belief that oil & gas can easily be replaced by so-called green alternatives. They're pushing forward with this stupid, unrealistic belief, and bowling over any resistance because the majority of people believe in this fairytale.
It's going to be entertaining to watch the unintended consequences of diminished personal autonomy, increased prices on consumer items, reduced pension funding for public sector workers (teachers in Cali) and the dozens of other unforeseen items.
And a Dutch court just ordered She’ll to reduce carbon emissions by 45% by 2030. The writing is on the wall.