Climate change and the oil economy

It is a big question, and it is a troubling question. To keep the climate change goal of restricting the rise of temperature to less than 2 degrees Celsius, it will be necessary to reach net-zero carbon emissions. This does not mean that there will be no carbon emission in 2050, or in 2070. It means that the amount of carbon emissions will be balanced by clean energy and renewable energy sources.

Saudi Arabian Energy Minister Prince Abdulaziz Al Salman addressing the International Petroleum Technology Conference 2022 in Riyadh said, “The net zero does not mean cherrypicking, net zero does not zero oil.” This is a debate that will rage for long. Some of the climate change advocates believe that the fossil fuels must be completely eliminated from the energy basket, but they are not in a position to ensure that the world’s energy needs can be met through renewable sources. This does not mean that the oil-driven economy will remain unchanged. Oil, natural gas and coal need to be supplemented through other means like solar power, hydropower and nuclear power. So, it would be unrealistic on the part of climate change advocates, especially in the European Union (EU) zone, to prescribe the energy strategy of the world.

If one takes the example of the automotive sector, it can be seen that the shift to an electric car (EV) will be gradual, and it will pass through a hybrid stage, where a combination of fossil fuels and bio-fuels would be used. The exclusive dependence on petrol and diesel would be brought down, but they cannot be eliminated totally. There are no radical solutions or radical shifts.

Saudi Arabia’s state-owned oil producer Aramco’s chairman Yassir Al-Rumayyan said that “after years of impressive growth, there are 10 million electric vehicles on the road, which is less than 1 per cent of the global car fleet.”

The Saudi minister was responding to the objections to investments in the oil industry. Investments will continue for a long time to come. And he pointed out that the energy supplies the world economy needs to recover from the effects of the pandemic cannot be produced because investments in fossil fuels had lagged behind.

It is a tough road ahead for the whole world in terms of energy supplies. It will be difficult for Europe to entertain the dream of getting out of the fossil-fuel driven economy. Even as the face-off between Russia and the United States and its NATO allies continues to simmer, there is a perceptible spike in oil prices. Europe needs gas and coal supplies from Asia. There are no easy solutions. Europe Union experts cannot set the climate change agenda. It has to be determined by all the countries in the world.

Every region and every country will make the necessary adjustments to avert climate change catastrophe in its own way and in due proportion. There are no global solutions, which can be imposed uniformly over all the countries. It is for this reason that the climate change talks are multilateral, and the decisions emerge after time-consuming consultations and discussions.

Western countries are also not willing to share technology to deal with a carbon-emissions based world economy, and yet all the countries are expected to conform to the goals of reducing the greenhouse gas emissions determined by experts in Europe.

But it is necessary that the debate should continue, and all the sides must be heard. No viewpoint should be played down or dismissed. A better solution is likely to emerge if the debate is broad-based, and it is more likely than not there will be many local solutions rather than a single solution.