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Market News

 April 16, 2007
Oil Giant Backs Mandatory GHG Emissions Cuts

 (Source: Sam Bond - Edie News) - Texas, USA -- A major oil company and insurance house have become the latest businesses to sign up to a corporate coalition calling for cuts to greenhouse gases to be made mandatory in the U.S..

ConocoPhillips and AIG joined the U.S. Climate Action Partnership (USCAP) this week, a lobbying organization whose membership includes a number of corporate big guns and aims to persuade Congress to implement a climate change law similar to that adopted by the British government in March this year.

The decision made the two the first American companies in their sectors to join the partnership.

While their have been rumblings in the American insurance sector for a number of years acknowledging the potential impacts of emissions, the public acceptance of man-made climate change by a U.S. oil major is a significant event.

"We recognize that human activity, including the burning of fossil fuels, is contributing to increased concentrations of greenhouse gases in the atmosphere that can lead to adverse changes in global climate," said ConocoPhillips' chief executive Jim Mulva in a statement.

The USCAP is calling for a cut in U.S. greenhouse gas levels by 10 percent to 30 percent within 15 years and by as much as 80 percent by 2050.

ConocoPhillips is the third largest U.S. oil company, behind only Exxon Mobil and Chevron, while AIG is the world's biggest insurer.

Their announcements come a day after a United Nations draft report said global temperatures were on track to exceed a rise of 2 degrees Celsius over pre-industrial times, and governments have little time left to avert damaging temperature increases.

Last week, the U.S. Supreme Court ruled that the U.S. Environmental Protection Agency had the power to regulate greenhouse gas emissions, rejecting arguments that the body did not have the authority to limit pollution from new cars and trucks.

The U.S. oil and insurance industries have been widely criticized by environmentalists as being slow to act against climate change.

ConocoPhillips' move made it the second major oil producer behind Britain's BP to join the group and moved it away from U.S.-based oil majors which both have resisted endorsing mandatory rules on emissions in the United States.

Both Exxon and Chevron said they had no plans to join the U.S. Climate Action Partnership, but planned to continue their involvement in discussions on proposed legislation.