Governments, not energy firms, must take the lead to achieve UN targets to contain global warming, with policies that will change fuel and other energy consumption habits, oil and gas companies said. (Reuters Photo/Fabrizio Bensch)

Governments Must Change Tack to Contain Global Warming, Big Oil Says


OCTOBER 11, 2018

London. Governments, not energy firms, must take the lead to achieve United Nations targets to contain global warming, with policies that will change fuel and other energy consumption habits, oil and gas companies said.

A UN panel called this week for "unprecedented" changes in how the world consumes energy and a dramatic rise in the use of renewable power to contain global warming at lower levels and protect the planet from heatwaves, floods and rising sea levels.

"Clearly it's a call to action," BP chief executive Dudley told an Oil & Money conference in London this week.

"Not only oil and gas companies, but you need that in agriculture, you need that in steel production, you need that in the use of people pushing the button on the wall to get electricity," he said.

Several oil and gas firms are among those taking steps to contain emissions of some greenhouse gases. Royal Dutch Shell, BP and Exxon Mobil have all set targets to reduce methane emissions.

"Let’s stop quibbling in society about whose fault it is and who should do more," Shell chief executive Ben van Beurden said.

To contain the rise in global temperatures at 1.5 degrees Celsius, the UN Intergovernmental Panel on Climate Change said manmade global net carbon dioxide emissions would need to fall by about 45 percent by 2030 from 2010 levels.

It said emissions should be "net zero" by mid-century.

Van Beurden said that, while such a target could be met, "it would not be commercially viable under today’s regulations and policies and market designs, so things would have to change."

BP's Dudley said more industry collaboration would help, saying cooperation between the energy industry and carmakers was helping achieve greater fuel efficiency and reducing emissions.

"We can do this even faster and more efficiently I think with clearer, smarter policy signals from governments," he said.

Governments have been introducing steps to reduce emissions, including promoting the use of electric cars, phasing out sales of more polluting diesel vehicles and encouraging use of renewable sources of energy.

US emissions have fallen to levels last seen 30 years ago as it uses more gas, which produces lower emissions than other fossil fuels such as oil and coal. Britain's carbon pricing policy has cut its emissions to the lowest in over a century.

But demand for oil continues to climb. The International Energy Agency (IEA) estimates global oil demand will hit 100 million barrels per day (bpd) for the first time this year.

Without a major shift in policies, the IEA expects world oil demand to rise for at least the next 20 years, heading for 125 million bpd around mid-century.

"The era of oil is far, in fact, very far from over," chief executive of Abu Dhabi oil company Adnoc Sultan al-Jaber said. "There is healthier demand for our product, which is undeniably good news for our industry."

Qatar Petroleum chief executive Saad Al Kaabi said it was too much to expect a dramatic reduction in the use of oil and gas, given demand for vehicle fuel and petrochemicals. "Oil is not going to completely go away but it is going to reduce," he said.

"Unless you give me a solution that's different than just 'renewables,' or say you want to do away with nuclear power also and so on, unless there is another way of getting there, it's difficult to comprehend how we'll achieve it," he said.