Oil giants must wake up to the urgency of climate change, or they will be forced to
- Oil companies’ record takings for 2022 give them a chance to pivot faster away from fossil fuels to renewables. At a time when public opinion and political pressure are turning against them, they must seize that opportunity
It makes for arguably obscene reading. Shell and BP alone have just reported profits of US$40 billion – more than double the previous year’s profits – and a record US$28 billion, respectively. The world’s five largest oil majors alone amassed more than US$150 billion in profits last year.
In a sane world, this would be like allowing them to throw kerosene on your house when it is already burning down and could be saved. The constant drip-feed of climate extremes and severe weather events around the world continue unabated.
Nevertheless, it is true that for the moment we still need fossil fuels. Oil and gas continue to provide vital heat, energy and transport facilitation around the world, especially in less-developed economies which do not have the capacity or funding to transition easily to renewable alternatives. These commodities are also vital in manufacturing, especially of plastics.
As news of these massive oil company profits reverberate, many governments are ramping up their transition to alternative renewable energy sources such as solar, wind, hydro, tidal, geothermal and even nuclear fission.
However, the key is not fine words, promises and good intentions but actual solid, verifiable actions. This is so we stand a chance of avoiding the worst impacts of the changes that are afoot.
Instead, they can invest a significant fraction of their profits in renewables and carbon capture technologies. This is so they shift from being mainly oil companies to mainly renewable energy companies with a sustainable green agenda.
They should invest their huge financial clout around the world for massive wind and solar farms and other renewables wherever their impact can be greatest, including down to practical and affordable solar arrays and wind turbines for small villages in Africa and Asia. If they do not change internally, they will be changed externally by circumstances and politics and will wither.
We might not be too far from the point when the will of the people and the resultant politics that flow will mandate stronger actions against the fossil fuel industry with all its greenhouse gas emissions and pollution it does not pay for. It is much better, responsible and in the industry’s own long-term self-interest for it to grasp the opportunity that these enormous profits present to be a better global citizen, show green leadership and point to a safer and better future for us all.
Quentin Parker is director of the Lab for Space Research at the University of Hong Kong and vice-chairman of the Orion Astropreneur Space Academy