Oil and gas companies can accelerate energy transition – Tue, June 28 2022

A secure and affordable energy supply has been a critical enabling factor for global economic growth. With the world economy growing each year, global primary energy consumption increased 15-fold from 1900 to 2019. Oil and gas industries account for more than 40 percent of total global greenhouse gas (GHG) emissions. Therefore, energy transition plays a crucial role in managing emissions.

This underpins the need to transition from fossil-based fuel to no or low-emission energy sources, the key pillar of the energy transition. We see a unique role of oil and gas (O&G) companies amid this push, including those of international oil companies (IOCs) and national oil companies (NOCs).

IOCs and NOCs can redefine their long-term value strategy for existing fossil-fuel (hydrocarbon) portfolios or expand into non-hydrocarbon portfolios depending on unique geographic opportunities. There are two main moves that IOCs and NOCs can make to respond to energy transition: Reduce one’s own emissions through decarbonization and more efficient operations and act where energy transitions create new, positive opportunities for oil and gas companies, such as investing in renewables,