Oman’s energy minister warned conference attendees recently “Recommending that we should no longer invest in new oil… I think that’s extremely dangerous.”
His biggest fear is that if we abruptly stop investing in fossil fuel, “there will be energy starvation, and the price of energy will just shoot (up).”
The United States Energy Information Administration’s long-term projection issued in February anticipates crude oil to hit $89 in the US in 2030 and $185 by 2050.
They admit that several factors could impact these figures, including other supply sources, access to renewable energy, and emissions taxes.
According to S&P Global Platts, OPEC is worried. Their concern is that an increase in oil prices could affect market volatility and threaten oil project investments.
Their concerns haven’t seemed to stop the push for net-zero emissions. Carbon pricing is taking off as global carbon markets continue to expand. In fact, countries that represent 70% of the global gross domestic product are committed to meeting international climate objectives – with all eyes set on eliminating emissions.
The Minister for Industry and Advanced Technology in the United Arab Emirates, Sultan al-Jaber, is not as concerned. “Even in the most ambitious energy transition scenario, oil and as will still be needed for many decades to come.” He went on to say that the Middle East’s reserves account for many of the least carbon-intensive barrels globally.
International Energy Director Fatih Birol said, “It’s an interesting race. Unless everybody finishes the race, nobody wins the race.”
If the oil industry can find ways to utilize its resources to achieve net-zero emissions goals, it may very well flourish — all while helping the world meet its 2050 deadline. With a bit of ingenuity and some unexpected partnerships, concerns of massive increases may become a thing of the past.
