Critics argue that shareholder resolutions rarely succeeded, that companies continue to produce oil and gas, and that governments and state policies ultimately matter more than investors. 

There is truth in some of those observations. But they also miss where investor influence is most visible. 

The strongest evidence is not found in annual general meetings. It is found in capital allocation. 

Geology dictates what is in the ground. Capital expenditure dictates what comes out. 

For decades, oil companies were rewarded for growth. Investors celebrated reserve additions, production increases and large-scale project development. The assumption was simple: future demand would be higher than today, so more reserves meant more value. Over the past decade that assumption has become far less certain. 

Investors began asking different questions. What if oil demand growth slows? What if electric vehicles scale faster than expected? What if renewable power becomes cheaper? What if some reserves prove less valuable than markets assume? 

Carbon Tracker’s work on stranded assets, our analysis of whether O&G production plans aligned with IEA net-zero scenarios, helped bring these questions into the mainstream of investor debate. Divestment campaigns and broader climate narratives reinforced them.  

As confidence in future demand weakened, investors became less willing to fund growth at any cost. Demand uncertainty, a wider climate context and declining confidence in long-dated projects helped shift investor priorities towards capital discipline, a theme we set out in Carbon Tracker’s landmark report Blueprint for an Energy Transition in 2015. As investors increasingly prioritised capital discipline over growth, behaviour across the sector started to change. 

Following the shale boom, oil companies were pushed to prioritise free cash flow, dividends and share buybacks over aggressive expansion. This shift is now visible across much of the listed oil industry: reserve replacement rates have fallen, exploration spending has declined, shareholder distributions have risen, and consolidation has accelerated. Many companies increasingly resemble mature cash-generating businesses rather than growth businesses. 

In 2023 Goldman Sachs noted that since 2014, “concerns around future demand and stranded assets had contributed to a sharp reduction in oil industry resource life, which it estimated had fallen from more than 50 years in 2014 to around 23 years.”  

Whether one agrees with every aspect of that analysis is almost secondary. Even critics of climate-focused investing increasingly acknowledge that investor expectations changed. 

The question is not whether investor pressure worked. If investor pressure had no influence, we might expect companies to continue pursuing reserve growth as aggressively as they did during the commodity supercycle.  

A more searching question is:  if projects became more economic, why were fewer sanctioned? And why did reserve life continue to fall?  

The answer lies at least partly in changing investor preferences and expectations, as well as better knowledge of the risks involved. 

At the same time, the debate itself has evolved. 

Ten years ago, much of the discussion revolved around scenarios, forecasts and long-term climate targets. Critics could dismiss these as hypothetical. 

Today the transition is increasingly observable. Decreasing oil company capital expenditure is measurable. Declining reserve replacement is measurable. Rapidly increasing buybacks and dividends are measurable. And on the other side of the ledger, surging electric vehicle sales are measurable. Global-scale industrial wind and solar deployment is measurable. Battery manufacturing is growing at exponential rates. 

The argument is becoming less about what might happen and more about what is already happening.

Investor pressure by itself will rarely determine the outcome. But it helped change what investors considered valuable. And when investors change what they value, companies eventually change how they behave. 

The balance sheets and capital allocation decisions of the oil industry suggest that the process is already under way. 

That does not mean the work is finished. As transition trends become more visible, debates increasingly focus on what those trends mean for competitiveness, industrial policy, security and investment decisions. The risk is not a lack of evidence, but a failure to respond to it. 

To hear more about the evidence, read our ‘Quiet Retreat’ and our interview on the topic with Christiana Figueres on Outrage & Optimism.

The post Does Investor Pressure Matter? Look at What Oil Companies Are Actually Doing appeared first on Carbon Tracker Initiative.

LONDON, 2 June, 2026 

New research from financial think tank Carbon Tracker shows that several legacy automakers carry climate-related financial risks comparable to traditional oil and gas producers. The findings are particularly relevant for Japanese OEMs ahead of the country’s AGM season, given their continued reliance on hybrid vehicles and their outsized role in global vehicle production.

The research, from financial think tank Carbon Tracker, finds that major automakers are systematically understating the emissions linked to their vehicles. Across a sample of 17 of the world’s largest OEMs, representing 80% of passenger vehicle sales, Carbon Tracker found an average discrepancy of 33% between reported and real-world emissions from vehicle use.

This “Carbon Gap” stems from widespread use of unrealistic lifetime mileage assumptions, optimistic plug-in hybrid vehicle (PHEV) usage estimates, and the exclusion of upstream fuel-production emissions.

Using a standardised methodology designed to reflect real-world vehicle usage, Carbon Tracker found that several automakers exhibit carbon intensity levels higher than major oil and gas companies when measured on the basis of emissions as a proportion of enterprise value (tCO₂e/EVIC).

Ben Scott, Head of Energy Demand at Carbon Tracker and co-author of the report, said: 

“Automakers are the gatekeepers of future oil consumption. Passenger vehicles are the largest source (27%) of global oil demand and every ICE or hybrid vehicle sold today locks in 10-20 years of additional consumption.  

Automakers’ flawed emissions reporting masks the reality that a dollar invested in legacy automotive firms is in many cases just as carbon intensive as a dollar invested in oil and gas.” 

Leaders and laggards 

The analysis identifies major differences both in transition strategy and emissions disclosure practices across the automotive sector, with some automakers aligning more closely with electrification trends and transparent reporting than others.

Renault and Stellantis emerged as relative leaders on emissions transparency, with reported Scope 3 emissions closely aligned with Carbon Tracker’s estimates, while companies such as BYD and BMW demonstrated substantially higher BEV sales shares than hybrid-heavy peers.

These issues are particularly relevant to Toyota, whose AGM falls on June 17. As the world’s largest automotive manufacturer by volume, with more than 10 million annual vehicle sales, Toyota maintains a hybrid-heavy strategy, selling approximately 27 hybrids for every battery electric vehicle in 2024.

Michael Wells CFA, Analyst at Carbon Tracker and co-author of the report, said: 

“Toyota’s hybrid emissions are an outlier in the sector, exceeding the total emissions of entire manufacturing groups such as BMW. Its hybrid-heavy resource allocation indicates a commitment to technology that faces obsolescence. As major markets move toward outright bans on internal combustion components, Toyota’s hybrid-heavy portfolio risks becoming a fleet of stranded assets.” 

Ken Maeda, Founder of Undertones Consulting, said:  

“Toyota’s heavy reliance on hybrids has delivered short-term sales success but carries significant long-term financial and market risks for both Toyota and the wider Japanese automotive industry. By locking in long-term oil consumption, this strategy heightens stranded asset risks at a time when global peers are accelerating electrification.”  

Mazda and Mitsubishi display the highest emissions intensities, of 10.2 and 9.9 tCO₂e/EVIC, respectively, compared with 4.0 for Shell, the highest intensity oil and gas firm featured in the report.

General Motors exhibits the sector’s largest absolute emissions gap, driven by a high-intensity product mix heavily weighted toward trucks and SUVs in the North American market, combined with the most significant disclosure deficit in the peer group. 

Subaru showed the largest relative reporting gap, with emissions potentially understated by more than 200% due to reporting assumptions that fail to reflect the high-mileage reality of its predominantly US-based fleet. 

Geopolitical Uncertainty and Consumer Lock-in

The financial risks of delaying the EV transition are being compounded by global energy shocks. The ongoing crisis in the Strait of Hormuz underscores the extreme vulnerability of the legacy automotive business model. Automakers persisting with ICE and hybrid technology are effectively locking consumers into highly volatile, inflated fuel costs for decades to come.

This exposure is particularly acute for the Japanese automotive sector. Japan is overwhelmingly dependent on foreign energy, importing more than 90% of its oil, largely from the Middle East through vulnerable chokepoints like Hormuz. By continuing to build vehicles that rely entirely on liquid fossil fuels, domestic giants like Toyota expose both their global consumer base and their home economy to structural macroeconomic instability.

Scott added: “The crisis in the Strait of Hormuz is a stark reminder that the real-world cost of driving a legacy vehicle isn’t static. When an OEM sells a hybrid or an ICE vehicle today, they aren’t just selling hardware – they are anchoring a consumer to the oil tap for the next fifteen years. In an era of acute geopolitical supply shocks, failing to decouple transport from crude oil is no longer just an environmental misstep; it is active destruction of consumer value and an unhedged risk for investors.”

Investor implications  

Carbon Tracker argues that that inconsistent and potentially understated emissions reporting creates material challenges for investors attempting to assess automaker transition risk and carbon exposure accurately.

The report finds that differing assumptions around vehicle lifetime mileage, hybrid usage and fuel-cycle emissions can materially distort reported Scope 3 Category 11 emissions, reducing comparability across issuers and potentially leading to the mispricing of carbon-intensive business models.  

Giuseppe (Joseph) Jacobelli, Managing Partner at Bourne Impact Capital Ltd and Founder of actE, said: 

“As for many other industries, carmakers failing to transition from carbon-intensive legacy assets to bankable ones face significant financial liabilities. Institutional portfolios must navigate this ‘bumpy flight’ by prioritising the economic inevitability of the green shift to prevent systemic capital erosion and asset stranding.” 

Carbon Tracker said that investors should move beyond headline emissions disclosures and scrutinise the assumptions underpinning automaker climate reporting, particularly ahead of key shareholder votes and transition-related engagements, such as Toyota’s AGM on 17 June. 

In particular it urges investors to focus on BEV Sales Share as the core transition KPI and incorporate carbon intensity (tCO₂e/EVIC) into corporate valuation models to avoid mispricing high-emission business models. 

Notes to editors  

The report, Oil Companies in Disguise, can be downloaded free of charge from here. 

 To arrange an interview please contact:   

Conor Quinn conor.quinn@greenhouse.agency  +44 7444 696 214 

Greenhouse Communications  TrackerGroup@greenhouse.agency     

A Japanese version of the press release is available here.

The post Legacy automakers are just as carbon-intensive as oil and gas firms, new analysis shows appeared first on Carbon Tracker Initiative.

Carbon Tracker and Confluence Philanthropy welcome you: 

Join us during London Climate Action Week for a timely discussion on the global shift away from fossil fuels – and what it means for investors navigating an increasingly volatile energy landscape. 

Limited space in-person, to register please email hannah.besly@tracker-group.org or join us online 

Investors are at a critical inflection point. Recent geopolitical tensions and market shocks have underscored the fragility of the global fossil fuel system. At the same time, clean energy and electrification are scaling rapidly, reshaping long-term oil and gas demand. International climate dialogues, including those from the recent Santa Marta process, are also sending increasingly clear signals about the direction and pace of fossil fuel phaseout. 

The session will explore how shifting demand and global policy alignment are reshaping fossil fuel markets and redefining risk, returns and capital allocation. 

This session will unpack: 

•  Key takeaways from the Santa Marta process and what they signal for policy and capital markets 
  • Official conference takeaways can be found here 
• The latest evidence on the global scaling of clean energy 
• How Middle Eastern stakeholders are navigating the transition and what this means for global supply, pricing and risk 
• What structural shifts in fossil fuel demand mean for investors and capital allocation 

Speakers:  

• Sandrine Dixson-Declève, Club of Rome 
• Jules Kortenhorst, Energy Transitions Commission 
• Patricia Fuller, The International Institute for Sustainable Development (IISD)
• Harjeet Singh, Fossil Fuel Treaty Initiative
• Mark Campanale, Carbon Tracker Initiative 

The post LCAW 2026: From Santa Marta to Crisis in the Middle East: Fossil Fuel Phaseout, Energy Transition and Implications for Investors appeared first on Carbon Tracker Initiative.

Automotive companies are widely positioned as transition leaders. But new analysis suggests investors may be significantly underestimating their exposure to oil demand and carbon risk.

Join Carbon Tracker and InfluenceMap for a 45-minute investor briefing on our forthcoming Oil Companies in Disguise – 2026 Edition report.

Our research finds that:

• Across major global automakers, reported Scope 3 emissions may underestimate real-world emissions by 33% on average.
• This “Carbon Gap” is driven by optimistic assumptions on vehicle lifetime, hybrid usage, and emissions boundaries.
• When adjusted for real-world conditions, some automakers exhibit carbon intensity levels comparable to, or exceeding, oil and gas companies.
• Hybrid-heavy strategies may be prolonging oil demand and increasing long-term stranded asset risk.
• Diverging electrification strategies are creating clear winners and laggards in the transition.

For investors, this raises a critical question: Are automotive portfolios carrying hidden oil exposure that is not being priced in?

What this webinar will give you:

This session is designed to provide practical, decision-relevant insights for investors, including:

• How to identify hidden carbon liabilities in automaker disclosures.
• What the “Carbon Gap” means for risk and portfolio alignment.
• Which OEM strategies are reducing vs extending exposure to oil-linked revenues.
• How to incorporate BEV sales share and emissions realism into investment analysis.
• Key questions for engagement, stewardship, and voting decisions.
• What evolving carbon accounting debates could mean for future disclosure reliability.

This webinar is a high-impact briefing for investors assessing climate risk, transition credibility, and capital allocation in the global automotive sector.

Speakers:

• Ben Scott, Head of Energy Demand, Carbon Tracker
• Ben Youriev, Director of LobbyMap Research on Energy, Mining and Transport, InfluenceMap
• Giuseppe (Joseph) Jacobelli, Managing Partner, Bourne Impact Capital Ltd and Founder of actE

The post Oil Companies in Disguise: Are Investors Mispricing Automotive Climate Risk? (Americas Session) appeared first on Carbon Tracker Initiative.

Automotive companies are widely positioned as transition leaders. But new analysis suggests investors may be significantly underestimating their exposure to oil demand and carbon risk.

Join Carbon Tracker and InfluenceMap for a 45-minute investor briefing on our forthcoming Oil Companies in Disguise – 2026 Edition report.

Our research finds that:

• Across major global automakers, reported Scope 3 emissions may underestimate real-world emissions by 33% on average.
• This “Carbon Gap” is driven by optimistic assumptions on vehicle lifetime, hybrid usage, and emissions boundaries.
• When adjusted for real-world conditions, some automakers exhibit carbon intensity levels comparable to, or exceeding, oil and gas companies.
• Hybrid-heavy strategies may be prolonging oil demand and increasing long-term stranded asset risk.
• Diverging electrification strategies are creating clear winners and laggards in the transition.

For investors, this raises a critical question: Are automotive portfolios carrying hidden oil exposure that is not being priced in?

What this webinar will give you:

This session is designed to provide practical, decision-relevant insights for investors, including:

• How to identify hidden carbon liabilities in automaker disclosures.
• What the “Carbon Gap” means for risk and portfolio alignment.
• Which OEM strategies are reducing vs extending exposure to oil-linked revenues.
• How to incorporate BEV sales share and emissions realism into investment analysis.
• Key questions for engagement, stewardship, and voting decisions.
• What evolving carbon accounting debates could mean for future disclosure reliability.

This webinar is a high-impact briefing for investors assessing climate risk, transition credibility, and capital allocation in the global automotive sector.

Speakers:

• Ben Scott, Head of Energy Demand, Carbon Tracker
• Ben Youriev, Director of LobbyMap Research on Energy, Mining and Transport, InfluenceMap
• Nana Li, Head of Sustainability & Stewardship, Asia-Pacific, Director, Impax Asset Management
• Giuseppe (Joseph) Jacobelli, Managing Partner, Bourne Impact Capital Ltd and Founder of actE

The post Oil Companies in Disguise: Are Investors Mispricing Automotive Climate Risk? (Asia-Pacific/Europe Session) appeared first on Carbon Tracker Initiative.

In partnership with MSCI, this roundtable will bring together experts from insurance, pension funds, and investment management firms for a discussion focusing on how to better integrate climate science into investment practices, prompted by the launch of Carbon Tracker’s latest report, Recalibrating Climate Risk. 

Following an introduction by expert speakers, we’ll be discussing the methods asset owners are using to assess their exposure to climate risks and identify opportunities in the transition. Most importantly, we want to explore the barriers that are hindering the re-allocation of capital towards low-carbon sectors. 

Meet the speakers

Active participation is encouraged; we’ll be circulating discussion points in advance of the event. Join us to share your insights and hear from other asset owners about how what role climate scenario analysis is playing in informing investment strategies, what policy solutions are needed to drive investment in low-carbon sectors, and other key issues facing progressive asset owners. 

The post LCAW 2026: Integrating Climate Risk into Investment Decisions and Risk Management: Roundtable for Investors appeared first on Carbon Tracker Initiative.

Join ClientEarth, Carbon Tracker and a panel of experts for an energising morning discussion during London Climate Action Week.

From the Strait of Hormuz to the North Sea, oil and gas markets are shaped by chokepoints. Some are physical; others are legal, regulatory and financial.

Amid shifting market dynamics, this event will explore the complex and changing path through which oil and gas projects are approved, financed, and retired in the UK.

Experts from law, academia, finance, policy research and civil society will explore these ‘chokepoints’ in the context of escalating climate impacts, tightening rules for project approval and asset retirement, and policy tension as the Government balances energy security with its commitment to end new licensing in the declining North Sea basin.

ClientEarth, Carbon Tracker and UCL will launch a pivotal new report, testing whether fossil reserves valuations keep pace with this shifting landscape, or leave investors blind to material financial risks.

The event will explore whether current rules across the fossil fuel lifecycle are fit for purpose, or whether, for oil and gas companies, disruption is on the horizon.

Confirmed speakers:

This is an in-person event at the Inner Temple in London. If you would like to join remotely please email events@clientearth.org to request a Zoom link. Thank you!

The post LCAW 2026: Disruption on the horizon: consent, capital and clean-up in the oil and gas sector appeared first on Carbon Tracker Initiative.

This webinar cuts through the hype, using market data, policy analysis, and lifecycle evidence to assess the true scale, cost, and sustainability of alternative jet fuels. The goal is not to dismiss them, but to recalibrate expectations, challenge overreliance, and position alternative fuels as one tool among many in aviation’s transition.

What you’ll leave with:

• A clear understanding of why truly sustainable fuels face structural limits.
• Insight into where alternative fuel investment makes sense—and where it doesn’t.
• A stronger basis for allocating capital and policy across aviation decarbonisation options.

The post Fuel Disclosure appeared first on Carbon Tracker Initiative.

London, 20 April, 2026 – Colombia’s continued reliance on internal combustion engine (ICE) vehicles is creating long-term economic liabilities and increasing exposure to imported refined fuels, according to a new report from Carbon Tracker. Transport accounted for 75% of Colombia’s oil consumption in 2023, with over 25% imported. Under a business-as-usual pathway, Colombia could spend up to US$226bn on fuel import for road transport through to 2050.

By contrast, an accelerated transition to battery electric vehicles (BEVs) would avoid 600 million barrels of oil equivalent (BOE) in fossil fuel use through to 2050 and deliver around US$40 billion in fuel import savings.

The report argues that continued ICE vehicle sales lock Colombia into decades of higher fuel demand, health costs and climate-related economic damage. Carbon Tracker estimates that every new petrol and diesel vehicle sold today adds substantial lifetime costs: nearly US$6k per passenger car, US$120k per medium-duty truck, US$278k per heavy-duty truck and US$350k per bus.

The analysis also points to the pressure on public finances. Carbon Tracker estimates fossil fuel subsidies at around US$6.8bn in 2025, compared with US$6.3bn in government revenues from fossil fuel sales, leaving a shortfall of US$0.5bn.

At the same time, the report finds that the global automotive market is shifting rapidly in ways that de-risk BEV adoption. China’s manufacturing expansion has helped cut battery costs by more than 80% since 2013, while expanding model availability and strengthening supply chains. For emerging economies such as Colombia, this is improving access to lower-cost electric mobility.

Carbon Tracker argues that Colombia is well placed to move faster in BEV adoption. The report highlights three key advantages: a relatively low (car ownership per capita), an electricity system primarily (72%) dependenton (clean) hydropower, and limited exposure to legacy domestic automotive manufacturing. Electricity also remains cheaper than petrol or diesel for road transport, lowering the lifetime ownership cost of BEVs compared to ICE cars for consumers.

Alongside the economic case, the report finds that an accelerated BEV transition could generate health cost savings from lower levels of harmful air pollution. It also estimates that lower vehicle fleet emissions could avoid up to c US$35bn (present value) in climate-related economic damages through to 2050.

Ben Scott, report author and Head of Energy Demand at Carbon Tracker, said:

“Colombia has a clear opportunity to avoid deeper dependence on imported transport fuels and the long-term costs associated with continued ICE vehicle sales. The country has structural advantages that support transition to BEVs, while providing an opportunity to phase down fuel subsidies, reducing pressure on public finances.”

The report calls on the Colombian government to develop a joined-up economic and industrial strategy that positions BEVs as a key sector in a modernised, low-carbon economy. It recommends strong supply-side regulations, co-ordinated fiscal reform, and targeted charging infrastructure rollout.

Read the full report here.

Lea la versión en español y descargue el informe.

Notes to editors

Leapfrog to Electric: Colombia. The Economic Benefits of Pro-Electric Vehicle Policy can be downloaded, free at [Link]. This report was produced in association with Polen Transiciones Justas.

Spokesperson: Ben Scott, Head of Energy Demand, Carbon Tracker

For more information and to arrange interviews please contact:
media@tracker-group.org

About Carbon Tracker

Carbon Tracker is a not-for-profit independent financial think tank that seeks to promote a climate-secure global energy market by aligning capital markets with climate reality. Part of the Tracker Group, Carbon Tracker’s research on the carbon bubble, unburnable carbon and stranded assets started a new debate on how to align the financial system with the energy transition to a low-carbon future.

The post Colombia could save US$40 billion in fuel import by accelerating electric vehicle adoption appeared first on Carbon Tracker Initiative.