Wed. Oct 4th, 2023
    Big Oil Executives Support Transition to Cleaner Energy, Emphasize Continuing Role of Oil

    The CEOs of Saudi Aramco and Exxon Mobil Corp. have expressed their support for the global transition to cleaner forms of energy while emphasizing the continued importance of oil in meeting growing global energy demands. Both CEOs highlighted the significance of capturing and storing carbon as a key solution to reduce emissions from fossil fuels, despite skepticism from environmentalists.

    Exxon CEO Darren Woods cautioned against drastically cutting oil usage, stating that maintaining some level of investment in the industry is crucial to avoid supply shortages and high prices. He emphasized the need for a gradual transition, as the demand for energy continues to rise worldwide.

    These remarks come as the oil and gas industry faces criticism and fights for control over the narrative surrounding the transformation of the global energy system to combat climate change. Despite being the target of clean energy advocates, environmental activists, and pro-green politicians, the industry has rallied, acknowledging the reality of climate change and the need to reduce carbon emissions.

    Both Woods and Saudi Aramco CEO Amin Nasser expressed optimism about the future demand for oil and dismissed predictions of a quick shift away from crude. Nasser projected record oil usage of 103-104 million barrels per day in the second half of 2022, with demand reaching 110 million barrels per day by 2030. They emphasized the importance of investing in new sources of production to meet this demand, rather than scaling back output as advocated by environmentalists.

    The reduction in exploration and production spending during the pandemic-induced economic downturn of 2020 has been cited as a factor contributing to the subsequent surge in oil and natural gas prices. Nasser stressed the need for continued investment to prevent future crises and avoid a regression to coal usage that would undermine decarbonization efforts.

    While the executives acknowledged the importance of a transition to cleaner energy, Saudi Energy Minister Prince Abdulaziz bin Salman called for honesty about the challenges ahead and the risks of mismanaging the shift. There were also concerns expressed by representatives from African petroleum-producing nations that the transition should not jeopardize their economies.

    The executives’ statements reflect a consensus among conference participants that while emissions need to be reduced, oil and natural gas will remain essential in meeting global energy demands. The focus is on transitioning away from emissions rather than completely phasing out oil and gas. The aim is to strike a balance between the urgent need to address climate change and the realities of meeting global energy requirements.

    Financial Times