One of the world’s leading oil chieftains spearheads the effort to “transition away from” fossil fuels. Meanwhile, some U.S. states are suing the oil giants, saying they have known for six decades their product leads to global warming and they did nothing about it.
The NOAA National Centers for Environmental Information estimates that 341 extreme climate and weather events have hit the United States since 1980, exacting $2.6 trillion. That includes the cost of lost economic opportunities, protecting cities and repairing damages.
For example, California is suing the world’s five largest oil and gas companies — ExxonMobil, Shell, Chevron, ConocoPhillips and BP, and their trade association, the American Petroleum Institute. The state says it has paid billions of dollars to adapt to climate change and address the destruction caused by it, and it will need to spend much more.
In 1968, the Stanford Research Institute issued a paper to the American Petroleum Institute saying that the Earth’s warming threatens us all: “Significant temperature changes are almost certain to occur by the year 2000, and … there seems to be no doubt that the potential damage to our environment could be severe.”
Enter COP28 President Sultan Al Jaber, who got the parties to the Paris Agreement to agree in December 2023 to phase down their use of fossil fuels, triple their deployment of renewables and reverse deforestation trends — all by 2030. Al Jaber, the president of the Abu Dhabi National Oil Co., persuaded the OPEC countries to follow these policies.
Doesn’t this stance contradict the goal of oil producers and their host nations? On the surface, it would appear so. However, the writing is on the wall. The globe is trending green, and the most progressive multinationals, such as Apple, Microsoft and Google, want to locate in environmentally conscious countries.
Moreover, the laggards get left behind. Witness some of the coal-producing states in Appalachia: they fought change to the bitter end and are now paying the price. As for the United Arab Emirates, oil made up 70 percent of its economy in 2009; today, it is 30 percent and is home to global enterprises and international tourism. It is now making green energy a big business domestically.
“We are very proud of this achievement — transitioning away from fossil fuels in a just, orderly and equitable manner,” Al Jaber said.
The media scrutiny, environmental protests and climate lawsuits have pressured the oil companies to re-examine their business strategies. All the major oil giants support the Paris Agreement’s goals — to keep temperature rises in check, which will reduce extreme weather perils.
For ExxonMobil’s part, it said the information it had nearly six decades ago was not conclusive. But it quickly added that much more is known today: climate change predictions are accurate, and everyone must do their part.
However, the International Energy Agency said that oil and gas companies spend about 2.5 percent of their capital budgets on clean energy, or $20 billion — a figure that must rise to 50 percent by 2030 to meet global climate goals. The agency also said oil and gas will still make up 46 percent of the worldwide energy portfolio in 2040.
So, is Al Jaber beating a dead horse, and are the oil enterprises serious about addressing climate change? If countries want to compete in the global economy, they must keep their word and drastically reduce their heat-trapping emissions. They must wean themselves from oil, which requires the oil majors to diversify their energy portfolios.
That could be anything from investing in electric vehicle charging stations, building wind and solar farms, and deploying carbon capture technologies. And they need to step on the gas.
“The big picture: We see an increase in extreme floods, droughts and heatwaves, which will continue to increase with a higher level of warming. There is no safe house,” said Professor Pierre Friedlingstein of Exeter’s Global Systems Institute.
Change is coming — exemplified by Sultan Al Jaber and the UAE. But resistance abounds, and it will undermine progress.
