In his COP26 speech, OPEC Secretary General Mohammed Sanusi Barkindo said: “This is no ordinary time. It is a landmark COP, where the future of humanity is at stake. With negotiations of such magnitude and consequence, we must remember the often ignored scientific fact: climate change and energy poverty are two sides of the same coin. The delicate balance between reducing emissions, energy affordability and security requires comprehensive and sustainable policies, with all voices being heard, and listened to.”
Barkindo added: “Focusing on only one of these over the others can lead to unintended consequences; market distortions, heightened volatility and energy shortfalls. We need to ensure energy is available and affordable for all; we need to move towards a more inclusive, fair and equitable world in which every person has access to energy, aligned with SDG 7; and we need to reduce emissions.”
Barkindo defined the desired objectives as ensuring energy supply to every individual and reducing emissions, adding: “It is an energy sustainability trilemma, with each piece having to move in unison.”
He noted that “the science tells us that tackling emissions has many paths. There is no one-size-fits-all solution, for countries or industries. The narrative that the energy transition is from oil and other fossil fuels to renewables is misleading and potentially dangerous to a world that will continue to be thirsty for all energy sources.”
The OPEC Secretary General stressed the need to consider the capacities, national interests, and development priorities of all developing countries, while taking into consideration the socio-economic impacts that the adoption of these new policies can have on these countries.
Financing is critical to reach the climate targets set in developing countries, Barkindo said, and developing countries have announced these financial requirements, which include financial resources, technological development and transfer, and capacity building, in accordance with the projects and programs required in this regard.
The Secretary General concluded his speech by affirming that OPEC advocates putting multilateral policies at the center of energy, climate and sustainable development, particularly policies that enshrine equity in action and priorities, common-but-differentiated responsibilities, and national circumstances. He stressed that the oil and gas industry can use its capacities, industrial facilities, and expertise to help unlock a low-emissions future by developing more efficient technological solutions.
The OPEC speech conveyed a well-considered stance that is based on positive and accurate positions. Saudi Arabia and the UAE have already invested in costly carbon capture and storage projects in the context of a carbon circular economy model, as have Egypt and Oman. This clean oil production process will supply clean (emission-free) oil and gas to the future energy supply chain, which should help increase available energies at the global level. The carbon circular economy model has only spread limitedly so far, but it heralds a promising future once the technology of this nascent industry advances.
The last few weeks have affirmed the warning launched by OPEC ministers against the reduction of oil investments as a prelude to energy transformation, as the oil price hike stems from the reduction of investments during the early stages of the COVID-19 pandemic, when commercial reserves and investment budgets shrunk in light of the price collapse.
OPEC ministers have repeatedly underscored the danger of such a short-sighted policy that does not account for the difference between short-term factors (oil industry requirements for market balance and stability) and long-term factors (reducing emissions over several decades). This misjudgment has led to an increase in prices and inflation rates in the US to record levels in the last three decades. The Biden Administration is trying to cover up this failure by pressuring OPEC+ to increase production above the currently defined level.
OPEC also warns of a dangerous turn on the path of climate change. Industrialized countries, regional and international institutions, and non-governmental climate movements are constantly escalating energy transformation and openly criticizing “the forsaking of oil and gas” despite the continued need for them and despite the possibility of emission-free petroleum production.
Furthermore, international reports and studies fail to account adequately for the role, capacities, energies, and financial capabilities of developing countries. A new landscape is crystallizing where energy transformation planning and action must serve the interests and ambitions of industrialized countries at the expense of developing countries. Such a dangerous direction could lead not only to further weakening and impoverishing developing countries, but also to widening the gap between industrialized and developing countries, which may, in turn, suck the world into new conflicts and mazes.
Industrialized countries have pledged $100 billion a year to developing countries over 10 years to help them address the damage caused by natural and climate disasters and wildfires and adopt projects to reduce carbon emissions. But these pledges have yet to translate into concrete support.
This article was originally published in, and translated from, the pan-Arab daily Asharq al-Awsat.