“Obviously, the world economy cannot completely shift out of fossil fuels overnight.”
When they made their discoveries of vast deposits of petroleum in southwestern United States, in the Middle East and elsewhere during the period from the late 1800s to the early 1900s, little did the geologists of the US and other Western countries expect that they would, a century later, undergo a drastic reputational change – from prime promoter of mankind’s progress to destroyer of planet Earth. No other sector of humankind has undergone such a rapid fall from grace in so short a time.
That fall did not happen overnight. It has been in progress since the establishment by scientific date, several decades ago, of a connection between CO2 (carbon dioxide) emissions and the gradual warming of the planet. For the world oil industry there was no escaping blame, for more of the other major sources of power – nuclear, geothermal, hydro and solar – generated CO2 emissions. Only fossil fuels did.
The recent 26th Conference of the Parties to the UN-sponsored international climate change discussions – COP26 for short – held in Glasgow, placed many things beyond doubt. Arguably the most important of these is the collision course upon which the increasingly unified world anti-global warming movement and Big Oil – the collective name for the grant companies that make up the world petroleum producing industry. It could hardly be said that Big Oil was the elephant in the room at COP26: it was front and center throughout the conference.
The agreed need to put an end to global warming almost entirely depends on the production and use of fossil fuels, and there is universal agreement that the reduced-global-warming target set by the Paris Climate Accord of 2015 – a 1.5 to 2.0 percent maximum increase above the pre-Industrial Revolution average world temperature – can be attained only by a progressive reduction in CO2 emissions. For Big Oil, that means a progressive reduction in the share of fossil fuels in the world energy consumption mix.
The world petroleum-producing industry is one of the world economy’s largest and most essential industries. It is made up of three parts, to wit, the U.S. and Canada, the members of OPEC (Organization of Petroleum Exporting Countries) and other non-OPEC producers. Most Big Oil producers are state-owned companies, such as Saudi Arabia’s Aramco; the rest are not. When one speaks of Big Oil, the corporate names that readily come to mind, besides Aramco, are Royal Dutch, British Petroleum and Chevron. These latter companies are truly international in scope and possess enormous industrial and political clout; they are the biggest of Big Oil’s biggies.
Dealing adequately with global warming is an existential question for Big Oil. Producing petroleum and getting the world’s people to use more of it is what their corporate lives are all about. Whether they are state-owned or not, the members of Big Oil are united in their intention to hang on to remain, collectively, the leading player in the world energy market and to keep fossil fuels as the largest part of world energy consumption for as long as possible.
Obviously, the world economy cannot completely shift out of fossil fuels overnight. Non-fossil fuel energy sources will have to be developed to replace fossil fuels as speedily as possible. The global-warming clock is ticking.
The collision course upon which Big Oil and the anti-global warming movement are embarked is, under the circumstances, inevitable. But collision courses are correctable. One side can correct its course and thereby avert disaster. Unfortunately for it, the needed course correction will have to be made by it.