Feb 26, 2020 - Energy & Environment

Cracks emerge in the oil lobby over climate change

Illustration of plants sprouting from an oil barrel

Illustration: Eniola Odetunde/Axios

European-based oil giants' evolving steps on climate change are cracking — but not yet rupturing — the industry's lobbying and advocacy relationships in the U.S.

Driving the news: This morning BP said it's leaving three groups over differences on climate policy: American Fuel & Petrochemical Manufacturers, the Western States Petroleum Association, and the Western Energy Alliance.

Why it matters: It's the most wide-ranging move yet by oil giants who are re-evaluating their trade group memberships as part of efforts to do more on global warming and as they face activist pressure. Last year, Shell and Total left AFPM too.

  • And it signals wider fault lines within the industry over climate as some companies, including BP, call for steps including carbon pricing and regulating methane emissions.

What they did: BP, which rolled out new climate pledges two weeks ago, this morning said it reviewed 30 memberships worldwide to see how in sync they were with BP's posture.

  • They surveyed topics like support for the Paris agreement, climate science, carbon pricing, regulations and more.

What they found: 22 groups were aligned with BP's priorities. Five were "partially aligned," while they were "unable to reconcile" their views with the three they're leaving.

  • BP said it broke with AFPM because they're "misaligned in activities to progress state-level carbon pricing programmes in the absence of a US national policy."
  • They offered a similar reason for ditching WSPA, and they're abandoning the WEA over the group's opposition to federal methane regulations

But, but, but: There's no head-on collision with K Street's biggest power brokers at this point.

  • None of the majors have bailed on the biggest and most powerful groups like the American Petroleum Institute, U.S. Chamber of Commerce and the National Association of Manufacturers.
  • BP said it was "partially" aligned with those groups.
  • For API, BP noted that while they're at odds on federal methane regulations, they note the group's work on voluntary industry efforts. And when it comes to the powerful Chamber, BP said they're only partially in sync on climate science and emissions cutting.

The intrigue: In one sign of the changing landscape, BP spent heavily to help defeat a Washington State carbon pricing ballot initiative in 2018. But, as the Seattle Times reported, last month they launched a pro-pricing PR campaign there.

  • In the new report, BP said that while they were in sync with WSPA in fighting what BP considered a flawed ballot measure, they disagreed with its opposition to what BP called "well-designed" cap-and-trade plans more recently before state lawmakers.

What's next: The Norway-based multinational Equinor is expected to announce the results of its trade association membership review by the end of this quarter.

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