What you need to know:
- Experts observe that over the past two years, global oil demand has rebounded to pre-pandemic levels, reaching 99.5 million barrels of oil equivalent per day.
- Additionally, oil prices soared to record highs as countries responded to the Russian invasion of Ukraine, delivering record profits for big oil and gas companies.
A new global report has found that despite a myriad of new ‘net zero’ pledges released in the past two years, the climate promises of major US and European oil and gas companies still fail to meet the bare minimum for alignment with the Paris Agreement.
According to the ‘Big Oil Reality Check’ report released last week by Washington-based Oil Change International in collaboration with over 35 organisations from across the globe, only eight oil and gas companies are involved in more than 200 expansion projects. The projects are awaiting approval between this year and 2025.
Experts analysed the latest climate pledges of BP, Chevron, Eni, Equinor, ExxonMobil, Repsol, Shell, and TotalEnergies against 10 minimum benchmarks for alignment with the 1.5°C temperature goal outlined in the Paris Agreement; including the new criteria highlighting the need to uphold human rights and indigenous peoples’ rights as well as free, prior and informed consent.
David Tong, the lead author of the report and global industry campaign manager at Oil Change International, explained that big oil and gas companies' climate pledges and plans appear to be designed to disinform and distract as opposed to seriously confronting the climate crisis. “This new analysis shows that not even one of the eight oil majors considered comes anywhere close to aligning their businesses with what’s needed for 1.5ºC.”
The findings provide new data on the climate threat from the eight companies’ near-term plans to develop new oil and gas extraction projects – plans that clash with the International Energy Agency’s conclusion that new oil and gas development should cease after 2021 to keep global warming below 1.5°C.
The report further highlights that if the oil and gas majors involved in over 200 expansion projects on track for approval go forward, their investments could create an additional 8.6 billion tonnes (Gt) of carbon pollution – equivalent to the lifetime emissions of 77 new coal power plants.
This came even as activists in East Africa protested against a multi-billion shilling dollar oil project in Uganda.
Another peer-reviewed study released last week found that burning oil, gas, and coal in fields and mines operating now would far exceed the remaining carbon budget for 1.5ºC.
“Instead of facing up to the reality of the climate crisis and cutting fossil fuel production, our analysis found that these big oil and gas companies plan to keep adding fuel to the fire,” Kelly Trout, the research co-director at Oil Change International, who believes that the few companies projecting declines in total production by 2030 appear to have a strategy of selling off dirty assets for other companies to keep exploiting, rather than winding them down, said.
Experts observe that over the past two years, global oil demand has rebounded to pre-pandemic levels, reaching 99.5 million barrels of oil equivalent per day. Additionally, oil prices soared to record highs as countries responded to the Russian invasion of Ukraine, delivering record profits for big oil and gas companies.
Yet the latest science shows an urgent need to end oil and gas expansion and deliver a rapid managed decline of the fossil fuel industry. The experts add that the rubric used to assess oil and gas companies focuses on the level of ambition to keep fossil fuels in the ground on a rapid timeline, the integrity of pledges, including their scale of reliance on carbon-sequestration, offsets or fossil gas and commitments to centering indigenous communities and workers . The experts point out that all the eight companies’’ climate pledges and plans are rated grossly insufficient overall, with Chevron and ExxonMobil assessed as grossly insufficient on all criteria.
In March, a report by researchers at the Tyndall Centre concluded that the wealthiest nations need to end oil and gas production by 2034 to preserve a 50 per cent chance to limit warming to 1.5°C.
The latest findings officially released by the Intergovernmental Panel on Climate Change shows global fossil fuel emissions – of which oil and gas contribute the largest part – need to decline immediately to preserve a chance at keeping global warming below 1.5°C. “The companies that have done the most to cause the climate crisis cannot be trusted to meaningfully confront it,” Mr Tong believes. “Big oil and gas companies will not manage their own decline. Investors and governments must step up and help us all break free from the unstable boom-bust cycle of the fossil fuel economy.”
Mohamed Adow, director Power Shift Africa, notes: “The danger for African countries is that we pour our limited financial reserves into developing a fossil fuel extraction and export industry for customers in Europe, who will only use us for a few years until their own investments in renewables come online and they stop buying African fossil fuels.
“Oil and gas companies in Europe and North America are also turning their sights on Africa as fossil fuels lose their political appeal and those countries seek to reduce their emissions. They are switching their lobbying efforts to make the case for African fossil fuels in a bid to survive the loss of support back home. The time is up for fossil fuels and if these companies do not stop such projects, our future will be catastrophic,” he adds.