After the Russian invasion of Ukraine scared the world into what a lack of oil and gas could bring about to economies and society, it seems that many investors and industry observers have come to acknowledge that the energy transition cannot replace fossil fuels overnight.
Oil and gas will be necessary to advance the transition – by helping the manufacturing of wind turbines or solar panels for example, or by generating for major energy companies cash needed for increased investments in low-carbon technologies and solutions.
Unlike a few years ago, everyone in the oil and gas industry is now talking about decarbonization and net-zero emissions. The energy transition narrative, from the industry's point of view, became part of the 'energy trilemma' as BP's chief executive Bernard Looney has put it—delivering secure and affordable energy when and where it's needed while raising investments in renewables and other low-carbon energy solutions.eek in Numbers: E
According to analysts, there is a broader understanding among the public and governments that until a clean energy system is ready, oil and gas will continue to play a prominent role in global energy supply and, like it or not, we are stuck with fossil fuels for our current energy needs. Right now, fossil fuels account for just over 80% of global energy supply.
"As the events of last year demonstrated, the sudden loss of even a small part of the world's oil and gas can have severe economic and social costs," Looney noted.
"And to be clear – we should be clear – orderly is not another word for slow. What it does mean is keeping affordable energy flowing where and when it's needed. Investing in the transition AND investing in energy security," BP's top executive added.
"Both things – at the same time. AND not OR."