The world-wide power vacuum – read “power” literally⚡and not politically🥴- is just as responsible for the recent invasion of my garage by a diesel generator as it is for the invasion of Ukraine by Russia.
I just watched a hilarious exchange on CNBC where everyone erupted at once.
Not only Joe, Becky and Andrew, but their guests too.
It was because Andrew, who is younger (and a bit liberal, I think), was defending the assertation by one of his guests, that legislation introduced by the liberal, politically correct, tree hugging (there’s nothing wrong with tree-huggers🌳😁), Biden/European/UK (delete/add as appropriate) administration have created a power vacuum that has emboldened Putin, due to Europe now being largely dependent upon Russia’s oil and gas, to invade Ukraine.
And it crystallised this thought; that the ESG (environmental, social and governance) movement has to take some responsibility for the invasion of Ukraine.
Think about it for a moment.
Our modern world not only needs power to juice its mobile phones and electronics, to warm homes and keep the lights on, to smelt aluminium and steel to make mountain bikes and bridges, to keep fertiliser plants running to grow our food, to purify our water to drink and wash in, to keep our supply chain running and to keep our cars, trains, planes and services running etc., etc.,
Indeed the world runs on its power supply.
And what we have seen, in recent years, is an admirable, but flawed, rush to decarbonise the world by switching to green power technology, before it is adequate to meet our current needs.
Sensitive and unloved oil majors have not rushed to invest in new oil and gas fields because these fossil fuels are on the way out and instead are buying back their shares to return value to diehard investors who have stood by them as ESG stricken pension and hedge funds have abandoned them, and courts have sued them.
And, despite Greta Thunberg’s protestations, these oil majors are not (completely) the bad guys; we still need them to help build the infrastructure and technology to enable us to transition to greener energy. These are merely “power” companies that speak with a fossil fuel accent (borrowed words from a Bloomberg commentator).
And I believe that some of them will eventually transition to green power companies anyway by buying out the green upstarts using the huge cash piles that their current operations are generating.
BUT, in the meantime, the resulting shortfall in available energy – the vacuum of waning oil and gas supplies in conjunction with Europe planning on turning off its nuclear power plants, whilst wind farms fail to deliver consistently – has created this new literal “power vacuum”.
It is partly responsible for the Ukrainian invasion, because, without its oil and gas dominance, and esteemed seat at the OPEC+ table, Russia simply would not have been able to economically afford to pay for such a venture.
On a brighter note, I see that Ceres (which is a widely misunderstood company imo) shares are doing well today.