By HE Haitham Al Ghais, OPEC Secretary General
Energy security is central to everything we do. Without energy, many things we take for granted would come to a standstill. Millions of jobs would also be lost. Economic growth would quickly go into reverse. It would create havoc to our everyday lives.
Later this week the UK government and the International Energy Agency (IEA) are hosting the ‘International Summit on the Future of Energy Security’ in London. The overall theme is one that OPEC supports. It is positive to see the IEA refocusing on energy security after veering away from this fundamental goal.
In recent years, the IEA has pushed for ideologically driven net zero goals, ones that have often been accompanied by targets or timelines that lack a grasp of what meeting them truly involves. In 2021, the IEA published its ‘Net Zero by 2050 – A Roadmap for the Global Energy Sector’ report. It created uncertainty for governments, businesses and investors.
Many net zero policies have endorsed unrealistic timelines or had little regard for energy security, affordability or feasibility, but were still promoted as the only way forward. For example, in April 2023, the executive director of the IEA, Fatih Birol, said in an interview with Deutsche Welle that its net zero scenario was now used as “a Bible of the energy world, the finance world and many, but not all, governments.”
Initial net zero policies were also often accompanied by calls to stop investing in oil, gas and coal, with the IEA stating in its ‘Net Zero by 2050’ that “there is no need for investment in new fossil fuel supply.” This gives little regard for how this would impact energy security, especially as these energy sources continue to make up over 80 percent of the global energy mix.
While promoting unrealistic concepts, the IEA has also delivered conflicting messaging. While downplaying oil, gas and coal, the agency sees global oil and gas demand reaching record highs this year, and despite predicting a peak in coal demand in 2014, it also sees record coal consumption in 2025. The reality is that today the world is consuming more oil, coal, gas, in fact, all energies, than ever before.
Narratives depicting renewables as ‘good’ and hydrocarbons as ‘bad’ to drive net-zero underscores why real-world data and forecasting – not ideology – should drive policy formation. The negative impact of shifting into policy based on wishful thinking, and not driven by actual data and trends, is a disservice to consumers and can have far-reaching consequences. Underinvesting in oil and gas does not support energy security.
From OPEC’s perspective, we believe that energy security must go hand-in-hand with reducing emissions whilst ensuring sustainable development. We do not view anything in isolation. We are not dismissing anything. This requires major investments in all energies, all technologies, and an understanding of the needs of all peoples.
[Today], OPEC is hosting together with the IEA and the International Energy Forum (IEF) the 11th IEA-IEF-OPEC Workshop on the Interactions between Physical and Financial Energy Markets in Vienna, which is an issue that goes to the very core of energy market stability, and accordingly, energy security.
We welcome this week’s conference in London on energy security. The background for the event states that “the IEA has been at the heart of international energy security for 50 years – working to avoid, mitigate and manage energy disruptions and crises”. At OPEC, we hope to see a renewed focus on this through developing an ‘all-encompassing’ approach to future energy pathways and energy security. We look forward to working with the IEA on this, after years of its messaging and policy prescriptions impacting energy security.
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