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Reducing global oil and gas production would be “dangerous and irresponsible” as the world still desperately needs those hydrocarbons, Shell’s chief executive Wael Sawan has told the BBC.
Last month, Shell unveiled its new strategy to continue investing in oil and gas production and selectively pour capital into renewable energy solutions, angering climate activists and some institutional investors.
Back in 2021, Shell said that its oil production peaked in 2019 and is set for a continual decline over the next three decades as it looks toward the renewables side of the business.
But in an updated strategy in June, Shell said that it would grow its gas business and extend its position in the upstream.
“Continued investments in oil and gas will be needed to make sure that the energy transition happens in a balanced way with a secure supply of affordable and increasingly lower-carbon energy,” Zoë Yujnovich, Integrated Gas and Upstream Director at Shell, said on Shell’s Capital Markets Day 2023.
Commenting on the words of UN Secretary-General António Guterres from last year that “Investing in new fossil fuels infrastructure is moral and economic madness,” Shell’s CEO Sawan told the BBC, “I respectfully disagree.”
“What would be dangerous and irresponsible is cutting oil and gas production so that the cost of living, as we saw last year, starts to shoot up again,” the supermajor’s top executive added.
Both UK-based supermajors, BP and Shell, have recently doubled down on oil and gas to ensure energy supply after the recent energy and energy security crises.
BP’s chief executive, Bernard Looney, also warned earlier this year that “We need to invest in today's energy system – which is predominantly an oil and gas system.”
“As the events of last year demonstrated, the sudden loss of even a small part of the world's oil and gas can have severe economic and social costs,” Looney noted.
Shortly after Shell unveiled its new strategy to continue investing in oil and gas production, the Church Commissioners for England said last month the Church of England was dumping all remaining oil and gas majors from its portfolio for failing to align with the 1.5 degrees Celsius pathway.
By Tsvetana Paraskova for Oilprice.com
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.