Illustration: Sarah Grillo/Axios

BP's mammoth asset write-down is certainly a big story, but whether it's a big climate change story is a trickier question. Let's give it a qualified yes.

Catch up fast: The oil-and-gas giant yesterday made several announcements rooted in its view of the "enduring impact" of COVID-19 on the economy and demand, and where it sees clean energy going.

  • BP cut its long-term crude price assumptions steeply, said it will write-down up to $17.5 billion on its assets, and signaled that some of its oil discoveries will never be developed.

Why it matters: That latter piece — an acknowledgment of what are known as "stranded" fossil fuel assets — made lots of waves yesterday.

  • Rachel Kyte, a veteran of international climate diplomacy and now dean of Tufts University's Fletcher School, tweeted that it's "hard to overestimate" the significance of yesterday's announcement.
  • A Financial Times (subscription) editorial notes (emphasis added): "Bernard Looney, the new boss at BP, is more upfront than some peers in stating that meeting climate change targets is triggering financial charges. There will be plenty more where these ones came from."
  • Oh, and a number not mentioned in yesterday's quick-hit: BP has sharply raised the carbon price it builds into its investment planning to $100-per-ton in 2030, a sign that it sees the world getting more serious about climate.

But, but, but: A couple of notes of caution are probably warranted.

  • One is that BP, which said the pandemic reinforces its long-term climate framework rolled out in February, expects COVID-19 to "accelerate the pace of transition to a lower-carbon economy and energy system." But the jury is still out.
  • Another is that BP's prior long-term crude price assumptions — now slashed 27% to a Brent price of $55-per-barrel — were higher than some peers, per this note from the Westwood Global Energy Group.
  • Oil analyst Arjun Murti said via Twitter that its old assumptions were simply too high and that pointing to the pandemic and the low-carbon transition is an "excuse" for yesterday's write-down of assets.
  • "I wouldn’t confuse unprofitable investments based on too high of a price deck with 'stranded' in the sense normally used by enviros," he said.

What we're watching: How other players might respond to BP's steps. The New York Times points out that BP's price assumption change "could put pressure on rivals to take similar steps."

The bottom line: "In the longer term, this is about BP’s strategic shift away from oil and gas," Wood Mackenzie analyst Luke Parker said in a note.

  • "While that will be a multidecade affair, BP is already getting to grips with the idea that its upstream assets are worth less than it believed as recently as six months ago. Indeed, some of them are worth nothing."

Go deeper: BP submits to brutal reality on the future of oil (Bloomberg)

Go deeper

BP to sell petrochemical division to Ineos for $5 billion

Photo: Yuriko Nakao/Getty Images

BP announced Monday a deal to sell its petrochemicals division to the U.K.-based multinational chemical company Ineos in a $5 billion transaction.

Why it matters: It's the latest move in the oil-and-gas giant's strategic overhaul, which includes selling its Alaskan assets and a pledge to reorient its business around low-carbon goals — a transition that will unfold over decades.

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Illustration: Sarah Grillo/Axios

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  4. States: Florida smashes single-day record for new coronavirus cases with over 15,000.
  5. Public health: Trump's coronavirus testing czar says lockdowns in hotspots "should be on the table" — We're losing the war on the coronavirus.
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Data: Covid Tracking Project; Chart: Axios Visuals

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The big picture: The figure shatters both Florida's previous record of 11,458 new cases and the single-state record of 11,694 set by California last week, according to AP. It also surpasses New York's daily peak of 11,571 new cases in April, and comes just a day after Disney World reopened in Orlando.