NEW YORK (Reuters) – Former United States Secretary of State Mike Pompeo took to the stage at the world’s largest energy conference in 2019 to declare an era of U.S. domination after a decade of rapid development of slates that made the United States the world’s largest producer of oil and gas.
Two years later, the oil industry is recovering from the worst recession it has ever experienced after measures to contain the coronavirus stopped billions of people from traveling and ended one-fifth of global fuel demand. The U.S. fossil fuel industry is still shrinking after losing tens of thousands of jobs.
The pandemic has also accelerated the energy transition, interrupting a steady increase in fuel consumption that may have continued for a few more years non-stop. Oil demand may never recover from this success. This year, the CERAWeek conference in Houston is completely virtual and there are numerous panels dedicated to the transition to the economy of the future with low carbon, hydrogen technologies and climate change.
Microsoft Corp. co-founder Bill Gates, U.S. climate envoy John Kerry, and Amazon speakers and renewable fuel giant Iberdrola are among the top speakers.
“The tone is different: there’s an issue that permeates the entire conference and that is the energy transition,” said Dan Yergin, founder of CERAWeek, vice president of IHSMarkit.
Last year’s conference was one of the first major world events to be canceled as the pandemic began to rage and made it unfeasible to gather thousands of people from 85 countries at the conference venues.
Since then, many of the world’s leading oil companies have set ambitious goals to shift new investments to technologies that reduce carbon emissions to curb global warming. UK-based BP Plc has largely abandoned its oil exploration equipment; The American automotive giant General Motors Co. announced plans to stop manufacturing gasoline and diesel vehicles in 15 years.
Of course, the 2021 program includes oil leaders who typically appear on CERAWeek. Among them are Mohammed Barkindo, secretary general of the Organization of the Petroleum Exporting Countries (OPEC), and top executives of Exxon Mobil, Total, Chevron and Western Petroleum.
But they will participate in panels focused on the energy transition. Barkindo will discuss what kind of recovery he will have from oil and gas as future demand is called into question. BP’s Looney will join Andy Jassy, who will become CEO of Amazon.com Inc. later this year, in a group about reinventing energy. Western CEO Vicki Hollub and UAE Minister Ahmed Al Jaber are scheduled to address reducing carbon emissions.
Oil companies have received growing pressure from shareholders, governments and activists to show how they are shifting their fossil fuel to renewable energy businesses and accelerating this transition.
“This year’s program reflects the reality of the transition to a zero-net future,” said Julien Pérez, vice president of strategy and policy for the Oil and Gas Climate Initiative, a consortium of large oil companies.
Yergin said Gates will discuss the difficulty of reducing emissions to a slow rise in temperature around the world. It is expected to focus on the technologies that are missing, but necessary, for the energy transition.
“You often go to conferences where people say,‘ Hey, we get companies to report their emissions and somehow magically make emissions disappear, or we’ll just divest stocks, ”Gates told Reuters at a previous month interview.
The reality, Gates said, is much harsher. Many heavy industries that use oil and gas are hard to get away from these fuels and this is where new technologies are needed. Steel, for example, still depends on metallurgical coal furnaces.
“If you are a steel company, you will report a very large number (emissions). People still need a basic shelter and we are unlikely to stop building buildings. “
While the shared goal of carbon neutrality has been widely accepted, finding the best way to achieve that goal is much more difficult, Yergin said.
“Previous energy transitions developed over centuries. It is intended to develop for less than three decades; that’s a big weight, ”he said.
Jessica Resnick-Ault Reports; additional reports from Katy Daigle; edited by David Gaffen, Simon Webb and Nick Zieminski