Reconciling the fossil fuel industry with climate goals

Reconciling the fossil fuel industry with climate goals

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Responding to the threat of climate change and continuing to produce fossil fuels seem like opposing and irreconcilable poles.

Those who advocate for sustainability are often labeled ideologues, while those who defend the production of fossil fuels are seen as complicit in environmental degradation. However, neither extreme will lead us to success. As we transition to net zero, the world will need to run two energy systems in parallel.

Decarbonization will undoubtedly take time, similar to the time it took to build our dependence on fossil fuels. The key is to ensure a balanced approach that prioritizes sustainability, affordability, and security, all within the context of economic responsibility and fairness for developing nations.

While the adoption of renewable energy sources is rapidly gaining momentum, oil and natural gas still account for 54.8 percent of global energy consumption, according to the 2024 Statistical Review of World Energy.

The oil and gas industry plays a pivotal role, both in providing the energy that drives today’s economy and in enabling energy transition for the future.

I would even go further and say that the technical expertise, required capital, extensive value chain, experience in capital optimization, familiarity with complex operations and markets, and mastery of the technology necessary to achieve the transition to a low-carbon economy can all be found in oil companies.

Keeping oil companies profitable and leveraging their strengths will be crucial to accelerating the energy transition.

While some oil companies aiming for net zero are making strides in certain areas, they are falling short when it comes to developing low-emission fossil fuels, which refers to the extraction, processing and use of oil and gas in ways that minimize environmental impact.

This contrasts with recent advancements in other heavy industries, where innovations like green cement, iron, and steel production are demonstrating the feasibility of reducing emissions, even at a premium. The oil and gas industry needs to catch up.

“There is some value in this ‘green oil’ label. In general it is welcome to have fossil fuels with low or zero production emissions as they represent 12 percent of the total equivalent CO2 emissions,” Andy Brown, Shell’s former upstream director and executive committee member, who also served as CEO of Galp, told me.

Since 2019, companies like BP, Lundin Energy, Occidental Petroleum, Petronas, Eni, Total, and Shell have offered “carbon neutral” oil and liquefied natural gas, some of them with a price premium and reputational gains.

Keeping oil companies profitable and leveraging their strengths will be crucial to accelerating the energy transition.

Rodrigo Tavares

But transparency is key when branding these products as “green oil.” For the term to be accurate, clear regulations defining what constitutes carbon-neutral crude oil are needed. This would include a universal methodology for calculating emissions throughout the industry.

Additionally, certification for carbon neutrality should be consistent, and oil majors would need to address emissions across their products’ entire life cycle.

Most importantly, achieving it could not rely solely on the purchase and retirement of carbon credits to compensate for the calculated lifecycle CO2e emissions of the product. “Offsets have increasingly been discredited as a way to claim abatement,” said Brown. Priority should be given to switching to lower operational greenhouse gas emissions.

Tellingly, just a couple of months ago, staff at the UN-backed Science Based Targets initiative, which certifies whether a company is on track to help limit global warming to under 1.5 C, expressed concern after plans were announced to allow companies to meet their climate targets with carbon offsets.

As we are still far from reaching this scenario, existing carbon crediting organizations like Verra lack the necessary standards for oil companies to generate carbon credits based on emission reductions.

But while “green oil” is difficult to attain, that should not preclude oil companies from pursuing product carbon reductions, aiming at positive impact and economic upsides.

But how can firms maximize returns on investment and minimize emissions per barrel?

Scaling up electrification, especially through renewable electricity, investing in energy efficiency, reducing fugitive methane emissions, venting and routine flaring, and improving geological surveying and digital technologies to decrease the number of dry holes are all viable options.

Carbon capture, utilization, and storage is another avenue. Aramco is currently developing one of the largest CCUS hubs in the world at Jubail Industrial City.

Through the 2023 Oil and Gas Decarbonization Charter, the 2015 “Zero Routine Flaring by 2030” Initiative, and the 2014 Oil and Gas Climate Initiative, oil majors pledge to reduce their greenhouse gas emissions and adopt targets for reducing carbon dioxide and methane emissions. And all leading oil companies have established net zero targets. These are important steps.

The future may see carbon intensity become as important a factor in valuing crude oil as American Petroleum Institute gravity and sulfur content are today, directly impacting its price.

International energy and sustainability organizations should establish clear methodologies, criteria, and standards for oil and gas to be classified as “low carbon” — a more achievable target than “green” or “carbon neutral.”

Only then can a price premium be realistically introduced into market dynamics.

Potential buyers include environmentally conscious refiners, who can leverage low-carbon oil to market cleaner fuels and sustainable products. Airlines and shipping companies, facing increasing pressure to reduce emissions, are also potential customers, as many have adopted ambitious carbon neutrality pledges.

One should note that governments worldwide are implementing mandatory carbon pricing schemes where polluters pay for their emissions, making low-carbon oil even more attractive.

While low carbon oil shows promise, it is just one step. We must prioritize replacing fossil fuels altogether with renewable sources.

Rodrigo Tavares is an invited full professor of sustainable finance at Nova School of Business and Economics, founder and CEO of the Granito Group, and former head of the Office of Foreign Affairs of the Sao Paulo state government.

 

Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News' point of view

‘Pissed off’ at Putin, Trump threatens tariffs on Russian oil if Moscow blocks Ukraine deal

‘Pissed off’ at Putin, Trump threatens tariffs on Russian oil if Moscow blocks Ukraine deal
Updated 6 min 25 sec ago
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‘Pissed off’ at Putin, Trump threatens tariffs on Russian oil if Moscow blocks Ukraine deal

‘Pissed off’ at Putin, Trump threatens tariffs on Russian oil if Moscow blocks Ukraine deal
  • “If Russia and I are unable to make a deal on stopping the bloodshed in Ukraine, and if I think it was Russia’s fault," he said on NBC News
  • Putin on Friday suggested Ukraine could be placed under a form of temporary administration to allow for new elections that could push out Zelensky

WEST PALM BEACH, Florida: US President Donald Trump said on Sunday he was “pissed off” at Russian President Vladimir Putin and will impose secondary tariffs of 25 percent to 50 percent on buyers of Russian oil if he feels Moscow is blocking his efforts to end the war in Ukraine.
Trump told NBC News he was very angry after Putin last week criticized the credibility of Ukrainian President Volodymyr Zelensky’s leadership, the television network reported, citing a telephone interview early on Sunday.
Since taking office in January, Trump has adopted a more conciliatory stance toward Russia that has left Western allies wary as he tries to broker an end to Moscow’s three-year-old war in Ukraine.
His sharp comments about Putin on Sunday reflect his growing frustration about the lack of movement on a ceasefire.
“If Russia and I are unable to make a deal on stopping the bloodshed in Ukraine, and if I think it was Russia’s fault ... I am going to put secondary tariffs on oil, on all oil coming out of Russia,” Trump said.
“That would be, that if you buy oil from Russia, you can’t do business in the United States,” Trump said. “There will be a 25 percent tariff on all oil, a 25- to 50-point tariff on all oil.”
Trump said he could impose the new trade measures within a month.
There was no immediate reaction from Moscow. Russia has called numerous Western sanctions and restrictions “illegal” and designed for the West to take economic advantage in its rivalry with Russia.
Trump, who spent the weekend at his estate in Palm Beach, Florida, told NBC News he planned to speak with Putin this week. The two leaders have had two publicly announced telephone calls in recent months but may have had more contacts, the Kremlin said in video footage last week.
The White House had no immediate comment on when the call would take place, or if Trump would also speak with Zelensky.
Trump has focused heavily on ending what he calls a “ridiculous” war, which began when Russia invaded Ukraine in February 2022, but has made little progress.
Putin on Friday suggested Ukraine could be placed under a form of temporary administration to allow for new elections that could push out Zelensky.
Trump, who himself has called for new elections in Ukraine and denounced Zelensky as a dictator, said Putin knows he is angry with him. But Trump added he had “a very good relationship with him” and “the anger dissipates quickly ... if he does the right thing.”

Growing pressure to end war
Trump’s comments followed a day of meetings and golf with Finnish President Alexander Stubb on Saturday, during Stubb’s surprise visit to Florida.
Stubb’s office on Sunday said he told Trump a deadline needs to be set for establishing a Russia-Ukraine ceasefire to make it happen and suggested April 20 since Trump would have been in office then for three months.
US officials have been separately pushing Kyiv to accept a critical minerals agreement, a summary of which suggested the US was demanding all Ukraine’s natural resources income for years. Zelensky has said Kyiv’s lawyers need to review the draft before he can say more about the US offer.
Trump’s latest tariff threats would add to the pain already facing China, India and other countries through trade measures imposed during his first two months in office, including duties on steel, aluminum and cars. More duties on imports from the countries with the largest trade surpluses are slated to be announced on Wednesday.
William Reinsch, a former senior Commerce Department official now at the Center for Strategic and International Studies, said the haphazard way Trump was announcing and threatening tariffs leaves many questions unanswered, including how US officials could trace and prove which countries were buying Russian oil.
Trump set the stage for Sunday’s news with a 25 percent secondary tariff imposed last week on US imports from any country buying oil or gas from Venezuela.
His remarks to NBC suggest he could take similar action against US imports from countries that buy oil from Russia, a move that could hit China and India particularly hard.
The US has not imported any Russian barrels of crude oil since April 2022, according to US government data. Before that, US refiners bought inconsistent volumes of Russian oil, with a high of 98.1 million barrels in 2010 and low of 6.6 million in 2014, according to a review of EIA data since 2000.
India has surpassed China to become the biggest buyer of seaborne Russian crude, which comprised about 35 percent of India’s total crude imports in 2024.
Trump on Sunday also said he could hit buyers of Iranian oil with secondary sanctions if Tehran did not reach an agreement to end their nuclear weapons program.


Serie A title race down to Inter and Napoli after Atalanta lose again

Serie A title race down to Inter and Napoli after Atalanta lose again
Updated 27 min 47 sec ago
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Serie A title race down to Inter and Napoli after Atalanta lose again

Serie A title race down to Inter and Napoli after Atalanta lose again
  • It’s developing into a two-team title race after third-placed Atalanta lost their second straight game, falling 1-0 at Fiorentina to drop nine points back
  • Cagliari beat last-placed Monza 3-0

ROME: Victor Osimhen left in September. Khvicha Kvaratskhelia departed in January.

Now it’s almost April and Antonio Conte’s Napoli — somehow — are still in contention for the Serie A title.

Matteo Politano and Romelu Lukaku scored first-half goals, Alex Meret saved a second-half penalty kick from Santiago Gimenez, and Napoli beat visiting AC Milan 2-1 on Sunday for a statement victory.

Luka Jovic pulled one back for Milan in the 84th to set up a tense finale during which Milan came close to equalizing.

The result kept Napoli within three points of Serie A leader Inter Milan, who edged Udinese 2-1 earlier.

It’s developing into a two-team title race after third-placed Atalanta lost their second straight game, falling 1-0 at Fiorentina to drop nine points back.

While Lukaku has filled the void left by Osimhen after the Nigeria striker left to sign a loan deal with Galatasaray, it has taken a group effort to replace Kvaratskhelia’s output after the winger signed with Paris Saint-Germain.

One player picking up playing time in Kvaratskhelia’s absence has been Politano. He seized upon a ball over the top from Napoli captain Giovanni Di Lorenzo and evaded three defenders to blast in a long-range shot 63 seconds in at the Stadio Diego Armando Maradona.

Then Billy Gilmour set up Lukaku all alone in front of the goal to double the advantage after less than 20 minutes – helped by poor positioning from Milan defender Kyle Walker.

It was Lukaku’s 400th goal for club and country.

Milan remained ninth.

Sommer’s saves help Inter preserve a victory

Goalkeeper Yann Sommer made two clutch saves in Inter’s win.

Marko Arnautovic took advantage of a rare start at center forward, opening the scoring early in the first half by redirecting in a cross from Federico Dimarco with one touch.

Davide Frattesi quickly doubled the lead with a nearly identical goal.

Center back Oumar Solet pulled one back for Udinese midway through the second half with a long, curling shot for his first Serie A goal.

Sommer then palmed away a dangerous effort from Lorenzo Lucca to preserve the lead.

Sommer also made a save on a close-range effort from Solet in stoppage time, after which vehement protests from Simone Inzaghi resulted in the Inter coach being sent off.

Arnautovic replaced Lautaro Martinez, who picked up a knock with Argentina.

Inter, which faces Bayern Munich in the Champions League quarterfinals, also sorely missed injured center back Alessandro Bastoni.

Atalanta’s fading title hopes take another hit

Atalanta were also beatwn 2-0 by Inter before the international break.

Fiorentina striker Moise Kean scored his 16th goal of the season at the end of the first half with a solo action.

“In terms of the title race, I would say we’re done,” Atalanta coach Gian Piero Gasperini said. “It was an impossible dream that I think had already faded away during the match with Inter.”

Also, Cagliari beat last-placed Monza 3-0.


Russia, US start talks on rare earth metals projects in Russia, RIA agency reports

Russia, US start talks on rare earth metals projects in Russia, RIA agency reports
Updated 16 min 44 sec ago
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Russia, US start talks on rare earth metals projects in Russia, RIA agency reports

Russia, US start talks on rare earth metals projects in Russia, RIA agency reports

Moscow and Washington have started talks on joint rare earth metals and other projects in Russia, Russia’s special envoy on international economic and investment cooperation told the Izvestia media outlet in remarks published on Monday.
“Rare earth metals are an important area for cooperation, and, of course, we have begun discussions on various rare earth metals and (other) projects in Russia,” Kirill Dmitriev, who is also the CEO of the Russian Direct Investment Fund, told Izvestia.
Putin, following negotiations between the US and Ukraine over a draft minerals deal, has offered the US, under a future economic deal, to jointly explore Russia’s rare earth metal deposits.
Dmitriev, who was part of Russia’s negotiating team at talks with US officials in Saudi Arabia in February, said some companies have already shown interest in the projects. He did not name any companies and did not reveal further details.
Izvestia reported the cooperation may be further discussed at the next round of Russia-US talks that may take place in mid-April in Saudi Arabia.
Rare earths and other critical metals, essential for high-tech industries, have gained global attention in recent months as US President Donald Trump spurred efforts to counter China’s dominance in the sector.


Tesla chargers torched in France arson attack

Tesla chargers torched in France arson attack
Updated 31 March 2025
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Tesla chargers torched in France arson attack

Tesla chargers torched in France arson attack
  • There have been a number of anti-Telsa actions in the US and Europe since Elon Musk became Trump’s adviser and backed European far-right parties

SAINT-ÉTIENNE, France: Twelve Tesla electric superchargers were targeted in an arson attack in the carpark of a supermarket in central France, a police source told AFP on Sunday.
The fire broke out overnight Wednesday to Thursday in the town of St-Chamond in the Loire department, the source said, confirming a report in the regional newspaper Le Progres.
Two of the chargers, each worth tens of thousands of euros, were completely destroyed, while the others were damaged.
“Anti-Tesla campaign born to burn” was found painted in white on the car park floor.
The police source said it was “the first act targeting the business of billionaire American Elon Musk” in the Loire.
An investigation for “damage and destruction by fire” has been opened but no arrests had been made, the source added.
There have been a number of anti-Telsa actions in Europe since Musk became US President Donald Trump’s adviser and backed European far-right parties.
Earlier this month, a dozen Teslas were torched in an attack on a dealership near the southern city of Toulouse, leaving eight vehicles burnt out.
Another four cars were badly damaged.
A recent spate of attacks on Tesla property in the United States have been described by Attorney General Pam Bondi as “nothing short of domestic terrorism.”


Lewandowski leads the way as Barcelona regains 3-point lead over Real Madrid

Lewandowski leads the way as Barcelona regains 3-point lead over Real Madrid
Updated 31 March 2025
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Lewandowski leads the way as Barcelona regains 3-point lead over Real Madrid

Lewandowski leads the way as Barcelona regains 3-point lead over Real Madrid
  • Lewandowski has scored nine goals in his last nine league games and has 25 goals in total in the competition, three more than Madrid’s Kylian Mbappé

MADRID: Barcelona reestablished its three-point lead over Real Madrid at the top of the Spanish league after beating Catalan rival Girona 4-1 on Sunday.
Robert Lewandowski added to his league-leading tally with two second-half goals.
Lewandowski has scored nine goals in his last nine league games and has 25 goals in total in the competition, three more than Madrid’s Kylian Mbappé.
“For me the most important thing is what I can do to help the team,” Lewandowski said. “I know that if I score two goals, I’ll be helping my team. As a striker it’s important to have confidence for when the ball comes to me.”
Barcelona went in front with an own-goal by Girona defender Ladislav Krejci in the first half. Ferran Torres added the fourth goal for Barcelona in the final minutes at Montjuic stadium.
On Saturday, Madrid had moved level on points with Barcelona with a 3-2 victory over Leganes at home and third-placed Atletico Madrid dropped nine points off the lead following a 1-1 draw at Espanyol.
It was Barcelona’s sixth win in a row in all competitions, and 11th in its last 12 matches. Hansi Flick’s team is yet to lose in 20 games this year, with its last loss coming against Atletico in December.
“We are in great form at the moment and we are creating a lot of chances when we have the ball. What I take from today is our ability to react after the break,” Flick said. “The great thing about my team is that we always want to score goals and everyone likes to see that.”
Barcelona has scored four or more goals in 20 of its 45 matches in all competitions this season.
“When you score four times it means you played a great match,” Lewandowski said. “We’ve been scoring a lot, and it’s important that when we can’t score early we have been patient and not changing our game plan.”
Flick praised the “special” Poland striker.
“Lewandowski is really important,” Flick said. “I don’t like to pick out individuals but he is special inside the box.”
Arnaut Danjuma scored early in the second half for Girona, which is winless in seven consecutive matches and stayed in 13th place.
Barcelona forward Raphinha stayed on the bench to get some rest following his matches with Brazil in South American World Cup qualifying.
Barcelona visits Atletico in the second leg of the Copa del Rey semifinals on Wednesday. The first match ended 4-4.
Other results
Fifth-placed Villarreal won 2-1 at Getafe to gain ground on fourth-placed Athletic Bilbao, which couldn’t manage more than a 0-0 home draw with 14th-placed Osasuna. Villarreal trails Athletic by six points with a game in hand.
Valencia moved to 15th place by beating eighth-placed Mallorca 1-0 with Diego López scoring the winner in the 50th. Valencia has won twice in its last six league matches. It was Mallorca’s first loss after six matches.