As talks continue at the Cop27 climate summit in Egypt, the world has been reminded that tackling climate change will require a radical shift in how society operates. The Intergovernmental Panel on Climate Change (IPCC) has said that to reach net zero by mid-century, emissions must fall 45 per cent by 2030 relative to 2010 levels, something that will require a rapid decline in fossil fuel consumption.
Big Oil, however, appears to have other plans. The world’s oil and gas companies are on a massive expansion course, investing $160bn (£137bn) into exploration between 2020 and 2022, according to the latest Oil and Gas Exit List from the German think tank Urgewald. What’s more, in the year that has passed since Urgewald’s 2021 list was published, the size of the industry’s short-term expansion plans have increased by a fifth, from 192 billion to 230 billion barrels of oil equivalent.
Three state-owned oil companies in the Middle East saw the biggest growth in short-term expansion plans over the past year: Saudi Aramco, Abu Dhabi National Oil Company and the National Iranian Oil Company. The highest-placed Western company on the list is the publicly listed French oil company TotalEnergies, a company that has pledged to reach net-zero emissions by 2050.
After a significant period of depressed oil prices and intense public scrutiny, oil companies have been buoyed in 2022 by soaring oil prices following Russia’s invasion of Ukraine. Companies such as ExxonMobil and Shell have enjoyed record profits as a result of the conflict.