The heads of Saudi Aramco and Exxon Mobil Corp. took to the stage at a major industry event on Monday to voice their support for the global transition to cleaner forms of energy, but one in which oil continues to play a major role for decades to come.
Both CEOs touted carbon capture and storage, a climate solution viewed with skepticism by environmentalists, as one of the best ways to significantly reduce emissions from burning fossil fuels. They also stated that reducing oil use too quickly would be dangerous, given the growing global demand for energy.
“There seems to be an illusion that we’re going to flip a switch and go from where we are today to where we’re going to be tomorrow,” Exxon CEO Darren Woods said during a panel discussion at the World. Petroleum Congress in Calgary. “No matter where the demand comes, if we don’t maintain some level of investment in the industry, you end up with no supply, which leads to high prices.”
The comments come as the oil and gas industry pushes back against its critics and fights for control of the narrative surrounding the transformation of the global energy system to limit the impact of climate change.
The sector is a natural magnet for criticism from clean energy advocates, environmental activists and green politicians. But after a tough period at the height of the pandemic, when demand and profits collapsed, the industry has bounced back amid rising oil and gas prices and landed on a common approach : Yes, climate change is real and carbon emissions must be reduced, but Big Oil is still essential to meeting global energy demand, and it can do so while designing a solution to aggressively reduce pollution.
Both Woods and Saudi Aramco CEO Amin Nasser were bullish on the outlook for oil demand and downplayed other forecasts about how quickly the world will run out of crude.
Nasser said he expects record use of 103 to 104 million barrels per day in the second half of this year, with demand rising to 110 million by 2030. That puts the onus on the industry to continue developing new sources of production, rather than appearing. setback as the environmentalists want.
The lull in exploration and production spending following the pandemic-induced pullback in energy demand in 2020 has been blamed in part on the surge in oil and natural gas prices that rocked the world last year happened after the Russian invasion of Ukraine.
“We need to invest,” Nasser told the conference, which coincides with Climate Week in New York. “Otherwise, in the medium to long term, we will have another crisis and go backwards in terms of using more and more coal and other cheap products available today. And all these decarbonisation efforts will go down the drain.”
Saudi Energy Minister Prince Abdulaziz bin Salman said the kingdom wants to support the transition, but politicians must be honest about the challenges ahead and the risks if the change is not managed well Prince Abdulaziz thought he would like a session at the next World Petroleum Congress, scheduled for Riyadh in 2026, to discuss how Saudi Arabia managed the transition without creating “havoc” in its economy.
Echoing these comments, Omar Farouk Ibrahim, secretary general of the African Association of Petroleum Producers, said the economies of the nations he represents should not be jeopardized by the transition.
“Given our peculiar situation in terms of socio-economic development and the fact that the problems of climate change were not caused by us but by the economically advanced countries of the world that use fossil fuels, calling us to join the same fast train up to net zero is unfair. and punitive,” he said at a press conference.
Alberta Premier Danielle Smith, whose province is hosting the conference and has the world’s third-largest oil reserves in its tar sands deposits, said energy must remain affordable and reliable. He also offered what may be a summary of the opinion of many conference participants.
“We’re transitioning out of emissions,” Smith said, “we’re not transitioning out of oil and natural gas.”
