Stocks in the eye of the storm

Talking about the weather became a whole lot more interesting in the United States of late: heatwaves in Alaska and snowfall in Texas are serious conversations starters. Hurricane Ian brought about a more sombre tone however, as devastation dominated the headlines, and the effects of climate change came back into focus.

Blasting through Cuba and blazing into Florida at 240kmph, Hurricane Ian decimated stretches of the Sunshine State’s west coast, and is likely to be remembered as one of the most expensive natural disasters on record. More importantly, it’s the deadliest hurricane in almost 100 years, with the death toll reaching 119.

The storm sparked chatter around whether climate change is to blame for the ferocity of recent weather patterns. While the frequency of hurricanes hasn’t increased, the storms are becoming stronger, wetter and wilder.

Tropical cyclones derive energy from the temperature of waters across which they move, and with the world being almost 1.3°C warmer that it was before the Industrial Revolution and bodies of water absorbing much of that extra heat, the science starts to make sense. Those balmy tropical breezes are also holding more moisture than ever before too, which sustains hurricanes when they reach the coast, and increases the amount of water they can dump as rain.

The paths hurricanes are blazing across land is being steered by changing airflows in various parts of the atmosphere, causing them to move more slowly and making them all the more dangerous.

If you start to think about the other effects of climate change such as rising sea levels, and how the next hurricane might weaponise these with devastating inland surges, it’s easy to start getting a little nervous about how bad the next storm might be.

The total cost of weather and climate disasters in America – to which storms are the largest contributor – in the past five years was $788bn. That’s about one-third of the total for 1980-2022.

And half a world away…

Pakistan’s recent floods rendered the UN Secretary General, António Guterres, speechless. More than 1,400 people have died, 33 million have been displaced, and 1.7 million homes have been damaged. Half the country’s cotton crop has been washed away, and this year’s wheat production could be largely written off. The government estimates that the floods will cost $30bn (9% of GDP).

Northern Pakistan features 7,200 glaciers that are melting faster than ever, largely as a result of greenhouse gas emissions. Along with other Himalayan glaciers, this region is known as the ‘third pole’ because it contains the world’s largest store of ice outside of polar regions. A recent study found that temperatures across the region rose by 0.42°C per decade in 1980-2018, twice the global average rate.

The situation is likely to get worse. Even under the Paris Agreement, in which global warming is capped at 2°C, one-third of Himalayan ice could melt during this century, with devastating effects for the region’s developing nations.

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