Elon Musk’s calls for increasing oil and gas output in the wake of the Ukraine invasion will not deter investors from positioning their portfolios towards renewable energy, according to Nigel Green, chief executive and founder of financial services firm, deVere Group.
Late last week, the Tesla boss said he supported increasing US oil and gas output despite the 'negative' impact it would have on his company.
'Hate to say it, but we need to increase oil & gas output immediately,' Musk posted to his more than 76 million followers on Twitter Friday night. 'Extraordinary times demand extraordinary measures,' Musk added, after the invasion of Ukraine by Russia led to a global surge in oil prices.
Said Green: 'Elon Musk is right - for the moment at least – to respond to the immediate crisis unfolding due to Russia’s invasion of Ukraine, and the fallout from it, we need to do everything we can, which includes increasing oil and gas production.
'This is because the investment to date in renewables has not been sufficient to react at scale when something of this magnitude happens. It shows how we should have gone harder and faster on green energy before now.
'The Ukraine-Russia situation is helping to drive oil and gas prices around the world, but investors who have properly diversified portfolios should not suddenly move away from sustainable alternatives.
'The case for green energy being an investment megatrend of the decade has not changed; The fundamentals remain the same.'
Real estate investment management giants have increasingly pivoted towards real assets with a green energy focus in recent times.
Last week Australia's Macquarie Group, which recently took a minority stake in sustainable office developer Edge, annouced that from April, it would launch a London-headquartered offshore wind arm as part of its Green Investment Group (GIG) business.
WHile the subsidiary, Corio Generation, will focus on constructing and buying infrastructure for ocean-based wind power, GIG will continue to deliver other renewable projects, such as solar and onshore wind.
Said Dooley, global head of GIG: 'We are launching Corio at a time where there is a real inflection point in the offshore wind story'.
Green added: 'Governments and regulators are becoming increasingly pro-ESG which boosts investor confidence. Second, as millennials, who are statistically more likely to seek responsible investment options, become the major beneficiaries of the largest intergenerational transfer of wealth – an estimated $30 tn (€27.7 tr) in the next few years – we can expect both retail and institutional investors to continue to pile into ESG.
'And third, the pandemic has focused minds on the fact that the health of our planet directly affects human health which, in turn, affects the way we all live and work.'
