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    Home > Chemicals Industry > Petrochemical News > Moody's: The credit risk of oil giants is increasing

    Moody's: The credit risk of oil giants is increasing

    • Last Update: 2021-06-04
    • Source: Internet
    • Author: User
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    According to a report from China Petroleum and Chemical Corporation News on May 28, 2021, Moody’s Investor Service said in a review of the oil industry that one

    The recent climate-related actions taken by the largest international oil companies on the board of directors and courts of

    The threat of Pro is rising.


    Moody’s Investor Services said: “The court’s new ruling against Royal Dutch Shell and the results of shareholders’ voting by Exxon Mobil and Chevron have highlighted the impact of major global oil producers on climate change.


    Recently, shareholders of the two largest oil companies in the United States, Exxon Mobil and Chevron, voted at the annual general meeting that they hope that the oil giants will adopt more climate actions and specific climate-related policies.


    At Exxon Mobil, the activist investor fund Engine No.


    At Chevron, shareholders support a proposal that the company cuts what it calls Scope 3 emissions, which are emissions from the use of its products.


    In the Netherlands, the court ordered Shell to cut its net carbon emissions by 45% by 2030.


    According to a Reuters report, Moody's Investor Services said in commenting on the climate-related actions of the oil giants:

    "These actions represent a major change in the outlook for oil companies.


    According to the rating agency, the most important development this week is that Exxon Mobil’s board of directors was lost to activist investor Engine No.


    Moody's Investor Services added that the vote of ExxonMobil's board of directors is also the most important because it is binding, unlike court cases that can be appealed.


    Moody's Investor Services said that increased shareholder demand for climate policy investment will increase the cost of capital for oil majors and may reduce the availability of capital for oil companies that fail to meet investor expectations.


    Li Jun compiled from the oil price network

    The original text is as follows:

    Moody's: Credit Risk Is Growing For Big Oil

    This week's climate-related actions in boardrooms and courtrooms involving some of the largest international oil companies signal rising threat to the sector, Moody's Investor Service said in a comment on the industry.


    "A new court ruling against Royal Dutch Shell and shareholder votes at ExxonMobil and Chevron highlights the increasing credit risk for major oil producers over concerns about climate change," Moody's said.


    This week, shareholders at the two largest US oil corporations, Exxon and Chevron, showed with votes at the annual shareholders' meetings that they want more climate action and specific climate-related policies from the oil majors to cut emissions and stay relevant in the energy transition.


      At Exxon, activist investor fund Engine No.


      At Chevron, shareholders backed a proposal that the company cut its so-called Scope 3 emissions, the ones generated by the use of its products, in another powerful statement from investors that they want the climate issue addressed.


      In the Netherlands, Shell was ordered by a court to slash its net carbon emissions by 45 percent by 2030.


      Commenting on these climate-related actions at Big Oil, Moody's said, as carried by Reuters:

      "These actions represent a substantial shift in the landscape for oil companies, which had previously prevailed in courts, and largely fend off significant shareholder votes, on climate-related matters.
    "

      This week's most important development was Exxon losing board seats to the activist investor Engine No.
    1, according to the rating agency, because it “likely presages similar results in future board elections at other US oil companies.

      Moody's added that Exxon's board vote was also the most important because it is binding, unlike the court case, which can be appealed.

      Rising shareholder demand for investment in climate policies would raise Big Oil's capital costs and could reduce the availability of capital for oil firms failing to meet investor expectations, according to Moody's.

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