Commodities crushed it in 2021, with stretched supply chains a driving factor. The strong performance didn’t stop as we entered 2022. In this blog, we specifically look at crude oil and natural gas, which have outperformed the European equity market by some distance since the start of 2021 (see Exhibit 1), and what this can mean for European ESG strategies.
Given the environmentally unfriendly nature of these fossil fuel-based energy sources, it would make sense for an ESG strategy to have less exposure to energy companies. This expectation would assume an active sensitivity to both crude oil and natural gas, causing a drag on performance during times of rising oil and gas prices. Is this assumption true?
You can now read the full whitepaper at the link below