If tech is king, then why are three of the world’s top 10 richest people in the energy business? The answer is simple: If you follow the money, energy is still wealth’s bread and butter, and technology is the key to nearly every industry in the world now.
It is not as simple as saying energy is on the ropes, and it is all about tech. There is a nexus that requires close attention.
Just a few short years ago, Exxon was the largest company in the world. This year, the oil giant was unseated from its long-standing place on the Dow index--with many seeing Exxon’s dethronement as the beginning of the end for fossil fuel companies, with the ever-growing chorus singing “Long Live King Tech!”.
It’s true, the energy industry--all energy, not just the fossil fuel industry--has had a rough couple of quarters, shedding billions in valuation. Meanwhile, the tech industry has been spared this fate.
Is this a temporary phenomenon with tech better suited to serve the locked-down world, or is energy out and tech in for good? Again, neither. We now live in a world of tech-driven energy, and tech-driven everything.
Related: What Are Anti-Solar Panels?
Our Who’s Who of the energy world and how they made their fortunes, shows the tech-heavy emphasis on a modern payday:
Elon Musk, $95.7 billion -- 2020 was a disastrous year for most. For Elon, not so much. You can say that Musk has his hands in tech as much as he does energy, but make no mistake, Tesla is how Musk has amassed most of his fortune, and it’s how he has made a name for himself. And what a name it is. From some nutty brain implant capable of hailing your autonomous (ahem, make that semi-autonomous) Tesla, to planning a colony on Mars, and from flamethrowers to the PowerWall, Musk’s wealth has increased nearly $28 billion in just 12 short months. When many of those months were in the middle of a pandemic, that’s none too shabby, and it just so happens to have landed him at fourth place in the world’s top ten richest people list.
Warren Buffett $111.34 billion -- Buffett lands at sixth place on the list according to the Bloomberg Billionaires list. While Buffett is not an energy company mogul per say, this billionaire is still betting big time in the energy business, sinking $10 billion on Dominion Energy’s natural gas transmission and storage assets in July in the middle of a pandemic that has most of the energy industry sitting tight and pinching pennies. While some see Buffett’s purchase as risky, others see it as wise, because natural gas pipeline companies have no direct competitors, and people utilize energy whether they are in lockdown or not. It’s not Buffett’s first foray into gas pipelines either. Berkshire Hathaway Energy already owns Northern Natural Gas and Kern River Gas Transmission. To be fair, Berkshire also holds a significant share in Apple (23.84% at last check), which hasn’t hurt his overall wealth. Back on the energy front, however, Buffett did ditch his unflattering common stock stake in Occidental Petroleum in Q2, which he received as a dividend from his $10 billion preferred stock stake. In Q2, Buffett has exited or reduced stakes in airlines, banks, and Sirius XM, but has upped his stake in Suncor Energy. Related: Can Tesla Live Up To Its $400 Billion Valuation?
Mukesh Ambani $79 billion -- Lesser known but certainly not less apt at wealth accrual is Mukesh Ambani, chairman and managing director of Reliance Industries. Reliance is India’s most valuable company, owning oil, gas, petrochemical, and natural resource subsidiaries. That’s not all, of course. Reliance also has grown to the size it is now through the help of Reliance Jio, its telecom/tech company arm that has piqued the interest of many an investor, including Saudi Aramco, which was just weeks ago considering a $15 billion stake in the refining giant. Aramco is also looking to purchase a 20% stake in Reliance’s oil to chemical business, valued at $75 billion--although the pandemic has delayed this deal.
The remaining people on the top ten list do include some tech giants such as Jeff Bezos, Steve Ballmer, and Bill Gates. And while the billionaires on this list have their hands in more than just energy, when three of the world’s top ten richest find merit in energy-related businesses, it is a clear indication that energy is not yet ready to be kicked off throne entirely. It just needs a little help from the tech sector.
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By Julianne Geiger for Oilprice.com
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