Oil Companies Blame Clean Energy Transition For Market Volatility

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Executives of the world’s largest oil companies used an industry rally in Houston to launch an attack on the speed of the clean energy transition, saying that a poorly managed process could lead to “insecurity. , galloping inflation and social unrest ”.

Executives at oil companies including Saudi Aramco, the world’s largest oil producer, and US oil giants ExxonMobil and Chevron have publicly called the switch to clean energy alternatives “deeply flawed.” They called for fossil fuels to remain in the energy mix for years to come despite global efforts for an urgent response to the climate crisis.

Saudi Aramco chief executive Amin Nasser told delegates to the World Petroleum Congress in Houston, Texas, that adapting “overnight” to cleaner fuels could trigger unchecked economic inflation.

“I understand that publicly admitting that oil and gas will play a vital and important role during the transition and beyond will be difficult for some,” he said. “But admitting this reality will be much easier than dealing with energy insecurity, rampant inflation and social unrest as prices become intolerably high and countries’ net zero liabilities begin to erode.

“The world is facing an increasingly chaotic energy transition, centered on highly unrealistic scenarios and assumptions about the future of energy. “

Anders Opedal, CEO of Equinor, Norway’s state-owned oil company, said: “The volatility of commodity prices and the impact on businesses and people illustrate the risks we face in an unbalanced transition.

Global oil and gas prices have risen in recent months since the initial lockdown of Covid-19, which choked economies around the world in 2020. Energy experts and economists have argued that the market skyrocketing global energy – which has sparked power outages, higher bills and the closure of factories in some countries – should encourage policymakers to accelerate the move away from volatile fossil fuels.

Amin said many “assume the right transition strategy is in place.” He said, “It isn’t. Energy security, economic development and affordability are clearly not receiving enough attention. “

The Saudi state oil company made the biggest contribution to the carbon dioxide emissions responsible for the global climate crisis of any major company, according to a Guardian investigation, after producing nearly 60 million tonnes of CO2 emissions between the 1960s and 2017.

Chevron made the second largest corporate contribution to global heating after producing 43.35 billion tonnes of CO2 emissions over the same period. Company CEO Mike Wirth told the same industry conference that oil and gas “continues to play a pivotal role in meeting global energy needs, and we play a critical role in supplying them. in a low carbon manner. Our products make the world go round.

Darren Woods, chief executive of ExxonMobil, the fourth largest corporate climate polluter behind Russian gas company Gazprom, told the conference: Play an important role in meeting the needs of society.

Calls for a slower transition to clean energy put oil executives on a collision course with energy industry experts, climate scientists and governments who have warned that without a rapid phase-out of CO2 over the next decade catastrophic levels of global warming will be inevitable.

US Deputy Secretary of Energy David Turk, speaking at the same conference, pushed back the industry’s stance against a rapid transition to cleaner energy by insisting there was an urgent need to ” take action to face the climate crisis. “There is no alternative to intensifying and addressing the threat of climate change,” he said.

The global energy watchdog, the International Energy Agency, told industry last year that no new fossil fuel projects were compatible with plans to prevent a crisis. climate before 2050.

A Greenpeace UK spokesperson said: “Fossil fuel markets have been a roller coaster of volatility since they were invented and it is ludicrous for the big oil bosses to blame renewables for their instability. On the contrary, the recent surge in gas prices and the hardship it has caused for so many households is further proof that the sooner we wean our societies off fossil fuels, the better. “

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