This infographic from the amazing Carbon Tracker attempts to explain the ways in which oil might already be becoming “stranded” in the ground, as low prices persist and structural changes in the energy market put a dampener on demand.
Paul Spedding, former Global Co-Head of Oil And Gas Research at HSBC and advisor to Carbon Tracker, says: “Though oil prices may be cyclical, structural changes in energy markets are likely to undermine price increases. Alternative transport technologies, including electric cars, static batteries, and hybrid solutions, are already threatening to make oil less necessary.”
While lower oil prices might be beneficial at the oil pump, the decline of the industry is, generally speaking, bad news for our money – as so much of the value of global stock markets is tied up in the performance of oil and gas companies.
Unless we try to move our money out of funds and stocks that have a lot of exposure to it: also know as “divestment”. Your stocks and shares ISA, other investments and pension are where you are likely to have the most exposure to oil price declines without realising it. Your investments have probably already lost some of their value in the last 18 months, unless you are already a low carbon investor.
Here are some ideas on where you might want to put your cash instead.