The impact of abnormal temperature and carbon emissions on stock returns of oil industry companies
: a US study

  • Vicente Gonçalves (Student)

Student thesis: Master's Thesis


Global warming became a concerning trend in the last century, especially since the late 90’s. The goal of my thesis is to understand the relationship between both carbon emissions and abnormal temperatures on stock returns from companies belonging to the oil industry. My datasets comprise 47 and 192 companies in the United States respectively and cover the period of 2010-2023. The Mean Percentage Quarterly Change and Mean Percentage of Positive Quarterly Change are included as variables of interest and both a random effects model and a logistical model are employed. The results show that returns from these companies are significantly affected by abnormal temperature in a positive sense. The more extreme temperatures, the higher the returns but the lower the percentage of positive returns. Moreover, a negative relationship between total emissions and stock performance arises. However, other metrics for carbon show a positive and significant interaction. This research contributes to the previous literature by adding providing empirical evidence on one of the most pollutant industries in the world: the oil industry.
Date of Award25 Jan 2024
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorZoe Venter (Supervisor)


  • Oil industry
  • Carbon emissions
  • Abnormal temperatures
  • Behavioral finance
  • Sustainable investment
  • Relationship
  • Stock returns
  • Market performance
  • Carbon risk premium hypothesis
  • Market inefficiency hypothesis
  • Divestment hypothesis


  • Mestrado em Finanças

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