Energy-sector ETFs the only group to see $1 billion in weekly inflows as Suez Canal blockage and coming summer demand create favorable backdrop for oil

oil texas
Workers extracting oil from oil wells in the Permian Basin in Midland, Texas.

  • Energy-sector ETFs took in more than $1 billion in inflows this week, the only funds from a major sector to do so.
  • Energy inflows accompanied some recovery in oil prices after they dropped into correction territory.
  • Oil prices could stick to higher ground if a cargo ship stuck in the Suez Canal remains lodged there for weeks.
  • See more stories on Insider’s business page.

Energy sector exchange-traded funds were the only group this week to add more than $1 billion in inflows as the cargo-ship blockage in the Suez Canal helped oil prices recover from their slump into correction territory.

Energy ETFs were a standout as flows to sector funds “fell prey to the general uncertainty” that ran through the week ended March 24, said EPFR, a subsidiary of Informa that provides fund flows and asset allocation data.

Four of the 11 major groups — commodities, telecoms, technology and financial sector funds — logged outflows for the week, according to a note issued Friday.

Investors pushed into energy sector funds “during a week when the blockage of the Suez Canal, the prospect of the North American spring and summer driving season and expectations of less investment in new supply helped the price of oil rebound from an earlier correction,” said Cameron Brandt, director of research at EPFR, in the note.

Brent oil, the international benchmark, and West Texas Intermediate crude prices tracking US light, sweet crude this week fell into correction territory, with prices down 10% or more from recent highs.

Prices have since recovered some ground, with Brent and WTI each rising by more than 4% on Friday. Brent traded above $64 a barrel after sliding below $61 this week. WTI hovered close to $61 following its drop under $58 a barrel.

Also on Friday, the Energy Select Sector SPDR Fund rose 1.8%, the Vanguard Energy ETF picked up 1% and the SPDR S&P Oil & Gas Exploration & Production ETF added on 2.3%.

Oil prices gained on expectations of tighter oil supplies while a cargo ship remains stuck in the Suez Canal, a key trade route that’s used to transport crude and refined products and connects Europe to Asia. Analysts have said it may be weeks before the Ever Given, a nearly 200-foot-wide and 1,300-foot-long vessel, is dislodged from the canal.

The blockage is costing $400 million an hour in delayed goods, according to a Lloyd’s List estimate, with hundreds of cargo ships are now unable to pass through the canal.

“The blockage has impacted over 20 oil tankers and the longer this lasts, it should drive oil prices higher,” Edward Moya, senior market analyst at Oanda, wrote in a note. Meanwhile, “Europe is slowly getting their vaccine rollout in order and that should trigger energy traders to price in an improved crude demand outlook by the summer,” he said.

As the summer driving season approaches in the US, roughly 14% of the population has been vaccinated for the coronavirus, according to the Centers for Disease Control and Prevention. President Joe Biden on Thursday raised his vaccination goal to 200 million for the first 100 days of his administration after hitting his previous target of 100 million.

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Oil climbs 4% after a grounded container ship blocks key Suez Canal trade route

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The tanker is blocking the Suez Canal.

  • Crude oil prices climbed as much as 4% on Wednesday to roughly $60 per barrel, boosted by concern over a supply bottleneck.
  • A container ship is blocking the Suez Canal, which is one of the busiest trade routes in the world.
  • Oil prices have been highly volatile throughout the pandemic and lockdown cycles.
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Oil rose as much as 4% on Wednesday after a huge container ship ran aground and blocked the Suez Canal, a key shipping route for crude and refined products. The blockage raised some concern about fuel supply.

Overall, the price of oil is set to fall for the third consecutive week this week. Another round of lockdowns in Europe could threaten the recovery in demand growth and have undermined some of the recent strength in the oil market.

One of the biggest container ships in the canal ran aground early on Tuesday and is stuck at a right-angle to the passage. Hundreds of cargo ships are now unable to pass through the canal, forcing them to divert their routes. It is unclear when the issue will be resolved. “This could have an impact on movement of oil and consumer goods.” Deutsche Bank strategist Jim Reid said in a daily report.

Throughout the pandemic and subsequent cycles of lockdowns and travel bans, oil prices have been highly volatile. Over the last 12 months, Brent crude oil prices have fluctuated from as little as $16 a barrel to as much as $71. As demand for oil, and therefore its price, is inherently linked to sectors that are impacted heavily by lockdown measures, such as travel, they have been sensitive to the developments of the pandemic. Over the last two weeks, prices have fallen by around 12% and are still on course for a third weekly fall, in spite of Wednesday’s rally.

The price response to the hold-up at the Suez Canal may not reflect expectations for a prolonged improvement in demand, analysts said. The futures market has eliminated a bullish structure known as “backwardation” – where prompt contracts trade at a premium to further-out futures contracts, which reflects bullishness among traders and investors about the demand outlook.

“The reprieve seems temporary, though, as the spot price fall overnight has completely removed the backwardation in the oil futures market for prompt deliveries. With speculative markets still long, it seems, oil is likely to be a sell on rallies until Covid-19 and economic recovery sentiment swings back into the black.” Jeffrey Halley, senior market analyst at OANDA, said.

Read more: MORGAN STANLEY: Buy these 10 stocks quickly that will roar higher as M&A heats up – including one with a potential upside of 114%

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ETFs tracking oil, air travel and retail are soaring as investors pile into stocks tied to the reopening of the economy

Alaska Airlines, American Airlines, and Delta Air Lines at LAX
Alaska Airlines, American Airlines, and Delta Air Lines aircraft at Los Angeles International Airport.

  • As the US economy opens up, investors have been piling into stocks tied to hopes of renewed growth and consumer spending.
  • “ETFs are an instant global diversification to many different companies from around that industry,” Andrew Chanin, CEO of ProcureAM, told Insider.
  • Year-to-date, some ETFs tied to oil, air travel and retail have seen record highs.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell

Vaccine distribution is priming the economy for a reopening later this year, and the pace so far has been faster than officials expected. Optimism is growing and investors have been piling into stocks that were beaten down by the pandemic but are now set to thrive as economic activity restarts. Investors are finding ETFs to be a solid bet on a range of reopening plays, sending some funds soaring year-to-date in 2021.

“ETFs are an instant global diversification to many different companies from around that industry,” Andrew Chanin, CEO and co-Founder of ProcureAM, told Insider. Chanin is behind UFO, an ETF focused on space exploration launched in 2019. UFO, he said, is “for investors looking to get access to the space economy and don’t want to settle or just pick a couple of names.”

Year-to-date, ETFs tracking oil, air travel, and retail are soaring, thanks to the value stocks – typically well-established companies that are often undervalued and have lower price-to-earnings ratios – in their holdings that could appreciate with a burst of new economic activity.

Cyclical industries are usually attuned to various business cycles. Revenues are higher when there is economic growth and lower in times of contraction.

Andrew Slimmon, managing director and senior portfolio manager at Morgan Stanley Investment Management, in a recent note said he is “extremely bullish” on value stocks, especially after the Federal Reserve’s decision to keep its policy in place until the US economy rebounds last week.

Here are three ETFs that are benefitting from investor sentiment around the economic reopening:

1. USO

The United States Oil Fund primarily invests in listed crude oil futures contracts and other oil-related contracts. The ETF, which debuted in 2006, may also invest in forwards and swap contracts.

The roughly $3 billion fund has gained 26% year-to-date.

Oil prices have soared since mid-February due to outages in Texas from the freezing temperatures. Refineries have taken a while to bounce back from the historic blast of winter weather, causing inventories to drop. Still, a summer rally may be in store for the oil ETF amid a tighter market.

Bank of America in February said Brent Crude prices could hit $70 a barrel in the second quarter of 2021. This year, it could average $60, the bank said, raising its average price outlook by $10 a barrel.

2. JETS

The US Global Jets ETF invests in the global airline industry, which includes airline operators and manufacturers around the world.

Launched in 2015, the roughly $11.5 billion fund has gained 25% year-to-date.

The index utilizes a tiered weighting scheme driven by market capitalization and passenger load. 70% of its weight is in US large-cap passenger airlines with the top four companies receiving 10% each. The next five largest US or Canadian airlines each receive a 4% weighting.

United Airlines and American Airlines are the ETF’s biggest holding both at 11% each, followed by Southwest Airlines and Delta Airlines at roughly 10% each. Alaska Air Group takes up 4%

The airline industry was among those that suffered the most when large swaths of the global economy shut down, halting travel in nearly every part of the world for some time. Optimism is gaining, however, when the Transportation Security Administration in mid-March revealed that air travel spiked to its highest level in nearly a year.

3. XRT

The SPDR S&P Retail ETF primarily invests in the US retail industry from apparel, automotive, computer and electronic, to department stores, general merchandise stores, and internet and direct marketing, among others.

The roughly $635 million fund has gained 42% year-to-date.

The top sectors it focuses on are internet and direct marketing at 21.5%, followed by automotive and retail at 18% each.

Holdings include Hibbett Sports, Wayfair, Best Buy, eBay, Murphy USA, Revolve Group, Magnite, Dick’s Sporting Goods, Albertsons companies, and Target, all weighing a little over 1% each.

As the economy rebounds from pandemic lows, the retail sector is making a strong comeback, driven by the pent-up consumer demand. Retail sales, according to the National Retail Federation, are expected to grow between 6.5% and 8.2% this year to more than $4.33 trillion in sales.

Many of the retail companies have also invested in enhancing their online presence to catch up on the e-commerce trend that many experts say is here to stay.

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Saudi Aramco loses title of world’s most profitable company to Apple as 2020 profits sink to $49 billion

FILE PHOTO: A view shows branded oil tanks at a Saudi Aramco oil facility in Abqaiq, Saudi Arabia, October 12, 2019. REUTERS/Maxim Shemetov
Branded oil tanks at a Saudi Aramco oil facility in Abqaiq.

  • Saudi Aramco reported a 44% decline in net income for 2020 to $49 billion as the COVID-19 pandemic weighed on results.
  • The world’s largest oil company said it plans to maintain its full-year dividend worth $75 billion.
  • Apple has claimed the title of the world’s most profitable company from Aramco, though that may be short lived.
  • See more stories on Insider’s business page.

Saudi Aramco is no longer the world’s most profitable company after the COVID-19 pandemic wreaked havoc on oil demand in 2020.

Aramco reported its full-year 2020 results on Sunday, showing a 44% collapse in profits to $49 billion. The world’s largest oil company said that despite the results, it plans to pay out its full-year dividend of $75 billion.

“As the enormous impact of COVID-19 was felt throughout the global economy, we intensified our strong emphasis on capital and operational efficiencies,” Aramco CEO Amin Nasser said.

Demand for oil was hit hard in 2020 as rolling lockdowns to combat the pandemic led to reduced travel across the globe. Oil briefly went negative, hitting $-37 per barrel as an imbalance between oil supply and demand led to limited places for storage of the commodity.

Aramco said its results were impacted by both lower crude oil prices and lower volumes sold, as well as weakened margins for its refining and chemicals business.

The results from Aramco mean Apple can now claim the title of the world’s most profitable company, as it reported $59 billion in income for 2020. But that title may be short lived for Apple and could be reclaimed by Aramco, based on a strong rebound in oil prices so far in 2021 and Aramco’s 2019 profit of $88 billion.

Energy represents the best performing sector so far in 2021, as WTI crude oil prices have surged 30% year-to-date.

In the year ahead, Aramco expects to spend $35 billion in capital expenditures, well below its previous guidance for $40 billion to $45 billion in spending.

“Looking ahead, our long-term strategy to optimize our oil and gas portfolio is on track and, as the macro environment improves, we are seeing a pick-up in demand in Asia and also positive signs elsewhere. We remain confident that we will emerge on the other side of this pandemic in a position of strength,” Nasser said.

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Oil tumbles 8% as uneven vaccine rollout threatens demand prospects

oil texas
Workers extracting oil from oil wells in the Permian Basin in Midland, Texas.

  • Brent and West Texas Intermediate oil futures each fell by 8% during Thursday’s session.
  • Rising COVID-19 cases in Europe are hurting demand prospects for oil.
  • A rise in the US dollar was also putting pressure on the commodity.
  • See more stories on Insider’s business page.

Oil prices were sharply knocked down Thursday, hurt in part by a dimmer outlook from Europe as the region battles rising COVID-19 cases counts and a sluggish rollout of vaccinations to curb the spread of the disease.

Brent oil, the international benchmark, extended its run of losses into a fifth session and West Texas Intermediate crude was in its sixth consecutive session in the red.

“Europe is struggling with COVID. Their pickup in crude demand is likely to lag the Americas and it’s probably going to really threaten a lot of hopes that we were going to see a big pickup this summer,” Ed Moya, senior market analyst at Oanda, told Insider on Thursday.

Brent oil fell 8% to $62.52 barrel and WTI fell by 8.3% to $59.25 per barrel.

Several European countries were recording a rise in coronavirus infections, prompting France on Thursday to declare new lockdown measures in Paris while Italy this week imposed movement restrictions.

Oil prices found no relief Thursday from the European Medicines Agency’s ruling that AstraZeneca‘s coronavirus vaccine developed with Oxford University is safe to use. The review came after several European countries suspended the vaccine’s use following reports of blood clots in some people who had been injected with the formula.

Meanwhile, oil was under pressure in the wake of the Federal Reserve’s policy meeting on Wednesday during which it upgraded its growth projections for the US economy.

“You have a stronger dollar which has emerged from the surge in Treasury yields, which is also weighing on commodities as well,” said Moya. The US Dollar Index rose 0.5% to 91.87.

The 10-year Treasury note yield note yield surged past 1.7% on Thursday, marking a fresh 14-month high and the 30-year yield rose to 2.5% for the first time since August 2019. Higher yields tend to make the greenback more attractive to holders of other currencies.

While the outlook for European oil demand looks weakened by the COVID crisis, there are still expectations for stronger oil demand from the US with vaccinations on the rise, said Moya.

“It’s going to be a very busy summer travel season and I think jet fuel demand will also bounce back. We haven’t seen airlines really increase their flights…but once we start to see that, that’s going to be very positive for the demand forecast.”

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Oil prices whipsaw as traders digest attack on Saudi oil terminal

saudi aramco plant
A view shows Saudi Aramco’s Wasit Gas Plant, Saudi Arabia in 2014.

  • Brent oil, the international benchmark, surged above $70 for the first time in more than a year. 
  • Saudi Arabia said it intercepted drone and missile attacks aimed against its facilities. 
  • Yemen’s Houthi rebels reportedly claimed they hit the facilities they targeted in Saudi Arabia.
  • Visit the Business section of Insider for more stories.

Oil prices shot up past $70 for the first time in more than a year after key facilities in Saudi Arabia came under a missile and drone attack Sunday.

Saudi Arabia said the attacks were intercepted, with an attempted drone strike aimed at one of the petroleum tank farms in the Ras Tanura port while a ballistic missile targeted Saudi Aramco facilities in Dharan, according to the Saudi Press Agency

Brent oil, oil’s international benchmark, climbed to an intraday high of $71.38 per barrel as it packed on more than 2% from Friday’s settlement. Brent oil hadn’t traded above $70 since January 2020. The price on Monday eventually turned lower, losing 0.2% at $69.24.

The West Texas Intermediate continuous oil contract reached as high as $67.26 before pulling back. It was off $0.02 at $65.43.

Yemen’s Houthi rebels on Sunday claimed they hit facilities in Ras Tanura, according to the Washington Post. A coalition led by Saudi Arabia has been fighting against the rebels backed by Iran since 2015.

“The Ministry of Defense will undertake all necessary, deterrent measures to safeguard its national assets in a manner that preserves the security of global energy,” said Brigadier General Turki Al-Malki of Saudi Arabia’s defense ministry in a statement.

Oil prices climbed last week after the Organization of the Petroleum Exporting Countries and its allies agreed to keep production cuts intact through April, a decision made as a recovery in the market is still taking shape while the COVID-19 pandemic persists.

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Oil surges 5% following reports OPEC+ will extend production cuts through April

oil texas
Workers extract oil from wells in the Permian Basin in Midland, Texas.

  • Oil prices surged by more than 5% after OPEC and its allies reportedly agreed to keep output levels steady. 
  • Saudi Arabia committed to sticking with a voluntary oil supply cut of 1 million barrels per day.
  • The supply decision by OPEC+ is “incredibly bullish” for the oil market, says one analyst.  
  • Visit the Business section of Insider for more stories.

Oil prices soared Thursday in the wake of reports that major oil producers have agreed to keep their supply cuts intact through next month.

OPEC and its allies had been discussing whether or not to restore as much as 1.5 million barrels a day of oil production. The group ultimately decided that it will leave output at current levels, according to a Bloomberg report

Saudi Arabia, meanwhile, committed to extend its voluntary cut of 1 million barrels of oil per day. The oil market officials meet via video-conference. The discussion took place at a time when recovery in the oil market is still taking hold after a plunge in demand because of the COVID-19 pandemic. 

Prices for Brent crude, the international benchmark, jumped as much as 5.3% to an intraday high of $67.47, with the gain later trimmed to 4.7%.

The decision by OPEC+ was “incredibly bullish,” and Saudi Arabia’s decision “was shocking as it leaves them vulnerable to losing market share next month when the oil market is in deficit by a couple million barrels,” said Edward Moya, senior market analyst at Oanda, in a note.

West Texas Intermediate oil futures also popped up as much as 5.3% to an intraday high of $64.51. The continuous contract was later up by 4.6%.

The Energy Select Sector SPDR exchange-traded fund climbed 3.8% and the United States Oil Fund, a popular oil ETF, moved up 6%.

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Fundstrat’s Tom Lee urges investors to buy oil stocks as energy ‘FOMO’ picks up, see’s 278% upside in this ETF

FILE PHOTO: An oil pump jack pumps oil in a field near Calgary, Alberta, July 21, 2014. Pump jacks are used to pump crude oil out of the ground after an oil well has been drilled. REUTERS/Todd Korol
FILE PHOTO: An oil pump jack pumps oil in a field near Calgary

  • The fear of missing out is likely starting to pick up for investors who have little exposure to energy stocks, according to Fundstrat’s Tom Lee.
  • The energy sector is up 32% year-to-date, but with such a low weighting in the S&P 500, investors have little exposure to the sector.
  • Lee said one oil ETF could surge 278% if the price of oil makes its way to $80 per barrel.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

The surge in energy stocks so far this year is likely creating “FOMO” for investors who have little exposure to the sector, Fundstrat’s Tom Lee said in a note on Wednesday.

Lee points out that the S&P 500 energy sector has soared 32% year-to-date, making it the best performing sector by a longshot this year. The next best performing sector is financials, with a return of 14%.

But investors have little exposure to the energy sector. According to Lee, the S&P 500 weighting to energy stocks is about 2%. That dynamic “potentially creates performance issues for those underweight energy,” Lee said.

Energy is a “misunderstood” sector, according to Lee. Warren Buffett’s right-hand man, Charlie Munger, probably agrees, who said on Wednesday that he does not foresee a long-term demise in the oil industry.

To gain exposure to the energy sector, Lee recommended investors buy the VanEck Vectors Oil ETF, which is “ridiculously cheap” relative to current oil prices.

“There is a comparative price gap between oil at $60 and where energy equities trade,” Lee explained. 

Based on an analysis of the price relationship between oil and energy stocks since 2009, Lee estimates that the Oil ETF could surge to $530 with oil prices at their current level of $60 per barrel, which represents upside potential of 178% from Tuesday’s close.

And if oil prices continue their upward trend to $80 per barrel, Lee estimates the Oil ETF could trade to $720, representing potential upside of 278% from Tuesday’s close.

“I recommend at least taking a small market-weight position, but obviously, since energy is one of our top 3 sectors for 2021, we recommend a much larger overweight,” Lee said.

The VanEck Vectors Oil ETF traded up 6% in Wednesday trades.

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Brent oil will climb 17% from current levels as demand outpaces supply, Goldman Sachs says

FILE PHOTO: The sun sets behind a crude oil pump jack on a drill pad in the Permian Basin in Loving County, Texas, U.S. November 24, 2019.  REUTERS/Angus Mordant
The sun sets behind a crude oil pump jack on a drill pad in the Permian Basin in Loving County

  • Brent oil should rise to $70 during the second quarter and to $75 in the third quarter, said Goldman Sachs in a research note Monday. 
  • OPEC and its allies will likely increase production at its March meeting but that still may fall short of Goldman’s demand forecast. 
  • Global oil demand should hit 100 million barrels per day by late July, the investment bank says. 
  • Visit the Business section of Insider for more stories.

Brent oil should jump 17% from current levels to $75 per barrel this summer, with Goldman Sachs expecting a lag in supply relative to demand to support a further gain in prices.

The Organization of the Petroleum Exporting Countries and its allies next month are poised to agree to boost production but the investment bank said the increase will likely fall short of its demand forecast.

Goldman Sachs now expects Brent to reach $70 in the second quarter and $75 in the third quarter, with each forecast raised by $10 per barrel. The investment bank’s call would represent a 17% upside from Brent’s intraday high of $63.94 in its continuous contract.

The “cross-asset oil outperformance this year remains driven by fundamentals, with better than expected demand and still depressed supply once again creating a larger deficit than even we expected in January and February, and with timespreads strengthening,” said Goldman Sachs in a research note published Monday and led by senior commodity strategist Damien Courvalin.

Brent oil prices have jumped about 23% this year after starting 2021 at nearly $52 per barrel. The vaccination of millions of people worldwide to curb the spread of COVID-19 has bolstered expectations that more businesses will reopen, which in turn brighten the outlook for oil demand.

OPEC next month appears ready to raise its oil production quotas by 500,000 barrels a day beginning in April, with Goldman Sachs saying its base case also includes Saudi Arabia reversing its production cut of 1 million barrels a day, a unilateral move announced in January.

“This remains however well below the 2.4 [million barrels per day] increase in demand we forecast from now to April — with as a result an agreement to hike production not bearish in our view,” said Goldman Sachs. “In fact, these barrels would arrive a month later at destination by which point we expect demand would have risen an additional 0.2 mb/d, further tightening the spot oil market.”

Goldman also said it has seen no signs of higher activity among most non-OPEC+ producers outside of North America, which creates risks that output will fall short of its demand forecasts by 900,000 barrels per day over the coming year.

Global oil demand should reach 100 million barrels a day by late-July, said Goldman Sachs, which would be sooner than its previous forecast for oil to reach that level in August.

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As a former oil executive, I can tell you Biden is not at war with oil. The industry has already been moving towards green energy

shale oil workers
  • Renewable energy is the future, building more jobs and economic stability.
  • Most Democrats and Republicans want climate to be a top government priority.
  • Oil company leaders know they’ll benefit from a faster energy transition.
  • Katie Mehnert is founder and CEO of ALLY Energy, an online platform for the energy community. Mehnert is a former global director at BP and Shell.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit the Business section of Insider for more stories.

As soon as President Biden began taking action on the environment, some lawmakers rushed to slam him for allegedly killing jobs in some sort of “war on oil.” They’ve been keeping this up in a steady, misguided drumbeat. This opportunism isn’t just politics as usual. It’s bad for the nation, the economy, and the world.

Biden is not “at war” with the fossil fuel industry. Society is at war with greenhouse gas emissions. And increasingly, the markets are turning against those emissions as well. 

Rather than fighting each other, we should all be working together. The crumbling of Texas’ power grid in the recent storm – in which problems plagued all energy sources including coal, natural gas, wind and nuclear – served as a powerful reminder

In the big picture, jobs in the oil industry have been falling in recent years. Far from being saved, the coal industry has been facing “some of its darkest days, plagued by falling demand, bankruptcies and job losses,” CNN reported.

Meanwhile, renewables are accelerating. Quartz declared 2020 “the year clean energy started to beat big oil,” most notably when wind and solar company NextEra became more valuable than Exxon and Chevron. (As Bloomberg put it, “clean power eclipses oil.”)  

I grew up as a second generation leader in oil and gas. I built a career in energy, spending time as a global health safety and environment leader at two oil giants. I have tremendous gratitude for the people who built the carbon infrastructure that has powered the world and delivered a huge number of the products that fill our daily lives. However, I’m also part of the effort to move the world into a  new era of renewable energy. 

I’m far from alone in this. In fact, you may be surprised by how much company I have. Despite stereotypes about Texas and the energy community wanting to produce and sell as much oil as humanly possible, many of us want to speed up the transition. I see this daily through interactions at ALLY, our digital community for a diverse workforce in all forms of energy. 

It shows up in survey data as well. In a poll last year by EY, oil executives named “decarbonization and other changes in response to climate change” one of the trends with the “most positive impact” on their company’s business growth.

While certain politicians fixate on oil, Texas has – perhaps quietly – become the “center of the global corporate renewable energy market,” producing more jobs from renewable sources than from coal. Here in Houston where I live, the city is producing a whopping 92% of its power from wind and solar – one of the highest levels of any city in America. 

We also know first-hand some of the drastic effects of climate change. We lived through Hurricane Harvey, a storm experts say was “almost certainly” more devastating because of human-caused warming. My family lost our home and had to be rescued by boat when the Army Corps of Engineers released dams in hopes of preventing even more catastrophic flooding in other parts of the Houston area.

Americans across the political spectrum have made clear that addressing the environment is an essential task of our time. In a Pew survey last year, two-thirds of Americans said the federal government was not doing enough. A recent study by Yale and George Mason University found that most Democrats and Republicans want the climate to be a top government priority. 

The writing’s on the wall. It’s time for lawmakers to read it and stop fighting. People want more green energy, which makes President Biden’s plan to make “the largest investment in history in American innovation” and create “10 million clean energy jobs” so promising.

Those jobs won’t be solely in companies that are exclusively focused on renewable energy. They’ll also be in clean energy projects of big oil companies, which are gaining ground in keeping with the companies’ net-zero targets. In fact, some oil giants are converting themselves into green energy stocks.

But there’s a long way to go. Oil companies can and should do more to join the wave of the future. This will require a burst of new talent, with ideas and innovations to speed up the transition. I’ve even recommended that we hire activists like Greta Thunberg to be a part of the energy sector. Bring them on board, so they can leverage their passion to help. 

When lawmakers trash environmental activists, they’re not helping the oil and gas community. They’re making it harder for us all to find common ground and make advancements together. As Vincent Saubestre, CEO and President for Total EP Research & Technology USA, said in a recent webinar with me, it’s time to end the “Darth Vader vs. Luke Skywalker approach.” In fact, he said, “We welcome critical allies that will challenge us to go further.” 

It’s time for an all-on-one-team mentality. The people, the markets and the new administration are all pushing in the same direction. Let’s get constructive and cooperate to drive an energy revolution. Our children are counting on us.

Katie Mehnert is CEO of ALLY Energy and Ambassador to the US Department of Energy’s Equity in Energy program. She is author of Grow with the Flow: Embrace Difference, Overcome Fear, and Progress with Purpose.

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