Exxon Mobil Corp. (NYSE: XOM) Last week, ExxonMobil as well as other big companies announced that they will support the rising U.S. tax on carbon. The tax would start at $40 a ton where all revenue would be returned as per-capita dividends to every U.S. citizen.
Based on this plan, oil companies would be protected from legal exposure to climate-based lawsuits that of which Exxon is much interested in as the company is currently being sued by a group of state attorneys general. This lawsuit claims that Exxon knew about the risks of climate changes way before those risks were even revealed to investors, and even when it did, declaring an internal carbon price was secretly using a much lower price in actual business decisions.
Exxon hit a 52-week low falling below $80 earlier this month partially because of global oil prices staying at a persistently low number. Despite these low prices, production kept increasing, however, it didn’t lead to any production cuts.
This carbon tax plan would also revoke a range of environmental regulations targeted at greenhouse gases which would be in favor of many oil and gas companies. However, these companies need to take on an active role in climate policy decisions by coming up with an agreeable carbon tax that replaces all other regulations.