• 4 minutes Energy Armageddon
  • 6 minutes "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 12 minutes "Europe’s Energy Crisis Has Ended Its Era Of Abundance" by Irina Slav
  • 5 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 3 days Is Europe heading for winter of discontent with extensive gas shortages?
  • 1 day Wind droughts
  • 4 days "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 2 days Kazakhstan Is Defying Russia and Has the Support of China. China is Using Russia's Weakness to Expand Its Own Influence.
  • 2 days Oil Prices Fall After Fed Raises Rates
  • 12 days How Far Have We Really Gotten With Alternative Energy
  • 4 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 10 days "Russian oil executive and Putin critic Ravil Maganov dead after mysterious six-story fall" - The New York Post
  • 2 days 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 7 days Beware the Left's 'Degrowth' Movement (i.e. why Covid-19 is Good)
  • 10 days The Federal Reserve and Money...Aspects which are not widely known
Energy Was Key In Putin-Xi Meeting

Energy Was Key In Putin-Xi Meeting

The meeting between Russian President…

Big Oil Under Pressure To Cut Production By 35%

Big Oil companies need to reduce their oil production by 35 percent by 2040 in order to preserve shareholder value in a changing world, think-tank Carbon Tracker has warned.

The changing world involves sticking to the Paris Agreement targets of keeping the rise of average global temperatures to below 2 degrees Celsius. To do that, Big Oil needs to seriously reduce the amount of carbon dioxide that it releases as it pumps oil and gas out of the ground.

Exxon, for instance, needs to reduce its annual emissions from close to an estimated 600 million tons this year to about 450 million tons by 2040, Carbon Tracker says. For Shell, the reduction needs to be from over 500 million tons to below that number in the next 20 years. The average emission reduction percentage across the Big Oil group is 40 percent, the think-tank has estimated.

These reductions, however, are calculated on the basis of what Carbon Tracker calls company carbon budgets. Yet these are not the companies’ actual budgets. In September, Carbon Tracker again sounded an alarm on Big Oil. It said the supermajors were betting $50 billion on oil and gas projects that would be unviable in a low-carbon world.

That report, titled “Breaking the Habit – Why none of the large oil companies are ‘Paris-aligned’, and what they need to do to get there”, the think-tank said Big Oil was not preparing for that low-carbon world and this could cost it dearly.

Related: Protect The Oil: Trump’s Top Priority In The Middle East

Under a scenario where global warming is arrested at 1.6 degrees Celsius, the energy industry would need an 83-percent lower capex, Carbon Tracker said. Under a 1.7-1.8 degrees scenario, oil and gas capex would need to be 60 percent lower.

The second report ties things together. Cutting capex is directly related to cutting production of fossil fuels. However, Big Oil might disagree that the world is changing as fast as Carbon Tracker and the International Panel on Climate Change would like.

As Shell’s Ben van Beurden notably said in a Reuters interview last month, the world “demands” oil, and until this is the case, the energy industry will continue to invest in the production of that oil.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment
  • Lee James on November 02 2019 said:
    Somehow, I don't think oil supplier production reductions are going to cut it. If a supplier tries to cut, another will deviate from the carbon reduction plan to satisfy world demand.

    I think it's up to the burners of oil to switch to clean energy. Maybe some of today's fossil-fuel producing companies can transition over to clean energy??

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News