The annual Oil and Money conference, held in London in October, heard from the chief executives of Gulf oil leaders such as Saudi Aramco and Abu Dhabi National Oil Company (Adnoc).
You might have expected that their overriding priorities would have been a sign the oil price is heading down to $50 a barrel; the need for further production restraint; and the desirability of an extension of oil producers’ group Opec’s deal with non-Opec nations, which is three years old in December. But they were not.
In a question-and-answer session, Saudi Aramco’s Amin Nasser (right) dwelt on preparations for the company’s initial public offering (IPO) but devoted most of his to speech to a call for more action to combat climate change.
The kingdom is aiming for 70 per cent energy efficiency in power generation and will invest in carbon capture and storage. It is also going to plant a million trees to offset carbon emissions.
Similarly, Sultan al-Jaber discussed Adnoc’s methane emissions, which he said were the oil industry’s lowest. The company aims to capture at least 4.3 million tonnes of carbon dioxide annually by 2030.
The new emphasis on environmental concerns did not only reflect the presence of climate change protesters outside the conference venue near London’s Hyde Park Corner. Arabia’s energy exporters are acting to defend their reputations at a time when oil and gas are out of favour among investors facing intensifying price unpredictability.
Young professionals are shunning careers in an industry that – if Greta Thunberg (right) and Extinction Rebellion have their way – will not exist in 30 years.
However, the good news for the Gulf oil industry is that demand for petroleum will continue to grow for at least a decade. Even when consumption starts falling – the consensus being that this will happen by around 2040 – Arabian oil will be the last to suffer. Reserves are massive and production costs are the world’s lowest.
There is no disguising the anxiety that is gripping the petroleum industry as the century’s second decade ends. This is principally a challenge for Western oil companies, which are facing increasing government regulation and public disapproval.
But there is also no escaping the mounting pressure on Gulf oil exporters to be seen to be doing more to reduce the environmental impact of an industry upon which their futures largely still depend.
This article was sourced from MEED, the world’s leading source of business intelligence about the Middle East. MEED provides exclusive news, data and analysis on the Middle East every day. For access to MEED’s Middle East business intelligence visit.