Jean Boissinot’s Post

Although we see tremendous growth in renewables, the oil and gas age is not behind us Global oil consumption is now likely to reach a record high level of 105 million barrels per day in 2024, with oil service segments running at full capacity to meet the call. This reality can be assessed from divergent perspectives. On the one hand, the peak is lower than what was anticipated a few years ago, and in that respect it is a positive signal for global warming. On the other hand, however, the bullish oil market can be interpreted as an ill omen for meeting climate targets. Either way, current market sentiments are very positive for the global oil industry and economic returns are at record highs. But what lies in store for the remainder of this decade – continued growth or plateau and decline? Let’s add some context to this discussion. Oil consumption in 2019 averaged 100.6 million barrels per day (bpd). If the pace of growth recorded from 2016 to 2019 had been maintained in ensuing years, consumption in 2024 would have reached 108 million bpd. But that trajectory was derailed by Covid-19, which took down oil consumption by more than 11 billion barrels – or on average 6 million bpd for the five-year period from the beginning of 2020 through 2024. Travel activity plummeted and sparked a structural change in business travel through greater adoption of virtual meetings. Seen in this context, current oil consumption levels are relatively low, and the impact of the pandemic has been beneficial for the climate. Moreover, the supply side’s ability to deliver has protected the global economy from a potentially devastating price increase that would hurt poor people the most. Here we must acknowledge that the only practical way to end the oil age is to substitute oil in end-user applications, while the supply side must deliver on the ask. Looking ahead at the 12 main oil consumption segments, seven are probably already past their peak levels and in structural decline. These are power generation, buildings, agriculture, rail, industry, buses, and vehicles. Two other segments – road freight and maritime – are about to plateau, while three segments are poised for longer-term structural growth: aviation, petrochemical and other non-energy use like asphalt and lubricants. In the latter cases, oil molecules are used to build materials, which means less greenhouse gas emissions per produced barrel. Taken together, our analysis shows that oil consumption is likely to plateau in the period 2025 to 2030 and then decline in the 2030s, with an increasingly growing share of oil molecules used for petrochemical purposes. The math behind this shows that, even at this pace, emissions from oil can decline fast enough to be compliant with climate targets between 1.6 and 1.9 degrees. 

The International Energy Agency (IEA) has published a report strongly advocating for an end to fossil fuel use and promoting unrealistic and unattainable approaches to achieving net-zero by 2050 as the Conference of the Parties (COP28) is upon us. The report shows a rapid decline in oil demand, urges an immediate transition to renewables, and states that carbon capture is merely an illusion. As the African Petroleum Producers Organization (APPO) rightfully states, the IEA approach poses detrimental impacts on Africa’s economies, representing a biased perspective that fails to take into account the needs and challenges of the continent. Africa is on the precipice of rapid, economic transformation. The continent holds over 125 billion barrels of crude oil reserves and 620 trillion cubic feet of natural gas reserves, resources which stand to serve as catalysts for industrialization and economic development. These resources can provide the over 600 million people and 900 million people currently without access to electricity and clean cooking solutions, respectively, with affordable energy. https://lnkd.in/dP7EppDF

🌐 In a recent article featured in The Asahi Shimbun, it becomes evident that Japan finds itself at a crossroads regarding its ongoing reliance on coal power. 🇯🇵🏭 Despite the landmark agreement reached at COP28, where countries committed to "transition away" from fossil fuels, Japan's position remains isolated. 🤔 The statistics speak volumes. Around 30% of Japan's energy is derived from coal, making it crucial to address this source's carbon footprint. Coal power is responsible for a significant 70% of global electricity-related emissions, making it imperative to expedite the shift away from this energy source. 🌍 At COP28, Japan conspicuously declined to join the Powering Past Coal Alliance, a coalition led by the UK and Canada, obliging developed nations to phase out coal power by 2030. Japan, as the sole G7 country refusing participation, stands out starkly. 🌱 Furthermore, Japan did not endorse the US-France-led initiative to cease private investments in coal and support local communities in transitioning to clean energy. 🔮 Prime Minister Fumio Kishida's pledge to halt new domestic unabated coal plants contrasts with the reality of only two such plants planned or under construction, while 170 operating plants persist. This indicates Japan's intention to prolong its reliance on coal, aiming to co-fire it with ammonia to qualify for emissions reduction exceptions under the COP28 agreement. 🔌 Under Japan's current energy plan, coal will still contribute to 20% of electricity in 2030. These actions led to Japan receiving the ironic "Fossil of the Day" award at COP28 twice, reflecting its regressive climate efforts. 🌟 In light of COP28's goals of tripling global renewable energy by 2030, Japan must reassess its stance. Observers stress the need for Japan to take more ambitious steps towards accelerating the global transition away from fossil fuels and fostering the rapid growth of renewables. 🚀 Check out this blog article and video we just created about these recent events. 🌿 If implemented across Japan's coal-fired power plants, our Navigator technology could play a pivotal role in ensuring a stable energy supply while simultaneously curbing emissions. 👁️🗨️ It's time for Japan to embrace innovative solutions like Navigator to address its coal dependency and contribute to a more sustainable and environmentally friendly future. 🌱💡 Don't miss the accompanying video that delves deeper into how Navigator can transform the energy landscape. Your insights and feedback are greatly appreciated! 👇🗣️📽️ #EnergyTransition #Sustainability #COP28 #AIEnergyTechnologies #AI #Japan #CarbonEmissions https://lnkd.in/g6Pej9JC

Are we headed to an Energy shock because of lack of investment? Will it be due to a shortage of fossil fuels or a deficiency in greening? Kate Dourian spells out the differences between the IEA and OPEC on Energy Transition assumptions: The IEA is more optimistic about renewable energy and electric vehicles, while OPEC maintains a more favorable view of continued oil and gas dominance in the energy sector. The divergence between the IEA and OPEC extends to their assumptions about China's role and the impact of India and Southeast Asia on energy demand. The IEA assumes that China's transition to a more service-oriented economy will lead to a plateau in its oil demand, while OPEC refutes this assumption and expects that India and the rest of Southeast Asia will accelerate the demand for fossil fuels, potentially compensating for a greener developed world. Major oil companies are finding themselves divided as well, with US majors aligning more closely with OPEC's perspective, while European companies are embracing the IEA's vision. As we consider these differing outlooks, several crucial questions emerge: 1- Will a Greener Developed World Unfold as rapidly and extensively as the IEA envisions and is there sufficient resources for it all? 2- Can Electricity Generation with current technologies Sustain 50% Renewable Generation? 3- Does EV Have Sufficient Consumer Demand and Infrastructure? 4- Is China Really Transitioning and moving away from heavy industry and manufacturing to a service economy? Surely, the Silk Road initiative is not aimed at pushing healthcare and education! 5- Can India and Southeast Asia Secure Sufficient Funding for Growth Projections? These questions reflect the uncertainties and complexities surrounding the future of energy, making it crucial for policymakers, industries, and stakeholders to consider a range of scenarios and prepare for potential shifts in energy demand and supply. The ongoing debate between the IEA and OPEC underscores the need for a comprehensive and adaptable approach to energy planning in the coming decades. Invest wisely or risk an impending energy shock!

As the energy transition progresses, views on its potential success or otherwise are diverging. As the energy transition gets underway and the urgency of combating global warming intensifies, there are widely divergent opinions on how the transition is going. The loudest critics and biggest pessimists, rather unsurprisingly, have a lot to lose from a switch to green energy, and include oil giants such as Saudi Aramco and ExxonMobil. The optimists are more widespread and environmentally driven, although many of them also have something to gain. But they have the admirable goal of a sustainable future on their side, and the advantage of evolving technology. Recent battery and solar advances, in particular, seem to be making the claims of the old fossil giants increasingly tenuous. In March, S&P’s CERA held its week-long annual conference in Houston, attended by the biggest names in the oil business, and this year there appears to have been a major backlash against moves to transition away from fossil fuels – despite the unmentioned consequences for global temperatures. Leading the charge was Saudi Aramco’s CEO, Amin Hassan Nasser, who said that the energy transition is “visibly failing”, and that he saw higher oil demand above 104mn b/d in 2025, describing the phaseout of fossil fuels as a “fantasy”.1 “A transition strategy reset is urgently needed, and my proposal is this: We should abandon the fantasy of phasing out oil and gas and instead invest in them adequately reflecting realistic demand assumptions,” he said, as reported in Platts and elsewhere. Nasser said the energy transition narrative would increasingly be written by the developing nations of the global south. Among the biggest failings of the transition, according to Mr Nasser and fellow sceptic, ExxonMobil CEO, Darren Woods, is green hydrogen, which they say is too expensive to replace fossil fuels. Mr Woods even suggested that the US would fail to meet its 2050 net-zero emissions target, partly due to this high cost of renewable hydrogen. Mr Nasser claimed that, in energy terms, the cost of green hydrogen amounted to the equivalent of $400/bl – about five times the current oil price. Weak link Criticism of hydrogen, however, is also coming from renewables purists who say electrification will eventually be a better option for almost all energy applications. Falling costs of batteries, EVs and solar panels are likely, the group believes, to make hydrogen use uneconomical compared to electrification in most fields, especially given the large amounts of energy lost in the conversion of renewable power to green hydrogen – arguments echoed by the big oil company CEOs at CERA-Week. The Hydrogen Science Coalition has been formed to represent these views, backed by leading academics around the world.2   The article goes on to look at surging EV sales in China and the steep falls in battery and solar costs driving the transition. Continues at tellingsense.com:

𝗜𝗦 𝗡𝗲𝘁-𝗭𝗲𝗿𝗼 𝗯𝘆 𝟮𝟬𝟱𝟬 𝗮𝘁 𝗥𝗶𝘀𝗸? 𝗜𝘀 𝗧𝗵𝗲 𝗦𝗰𝗲𝗻𝗮𝗿𝗶𝗼 𝗣𝗼𝘀𝗶𝘁𝗶𝘃𝗲 𝗳𝗼𝗿 𝗙𝗼𝘀𝘀𝗶𝗹 𝗙𝘂𝗲𝗹𝘀? The energy transition isn’t moving anything like fast enough so achieving global net zero by 2050 looks increasingly in doubt. Oil demand continues to increase year-on-year, reaching a peak of 114 million b/d in 2033 (compared with a 108-million b/d peak in 2030 in the base case). There are significant implications for the development of new oil supply, price and the strategic positioning of the industry at large. The global economy still runs on fossil fuels. Capital-intensive technologies – such as green hydrogen and carbon capture, utilisation and storage (CCUS) – are not commercially viable today without hefty subsidies. Higher interest rates have further eroded the economics. https://lnkd.in/ggBxr_DZ #oilgas #oilandgas #energy #strategy #netzero #technology

Energy Transition Enormous challenges The challenges of energy transition to get net-zero greenhouse gases (GHG) by 2050 are enormous. Using data from https://lnkd.in/depYc56E, in 2022, for the UK, fossil fuels provided 5.47 exajoules (EJ) of energy. To replace even 60% of current fossil-fuel use, the rest assumed to come from efficiency improvements and societal changes, the UK will need to build new continuous carbon-free power generation capacity of 104GW in the next 25 years. This is equivalent to 35 new nuclear power stations of the size of Hinkley Point C ( https://lnkd.in/dCAUF5FQ ) or 260,000 wind turbines of 1MW capacity, assuming a much-improved capacity factor, CF, of 0.4 (current value for CF is 0.32 for wind). In addition, livestock farming, aviation, steel and cement industries need to be essentially shut down and an enormous new energy infrastructure has to be built while safely dismantling the existing one. However, the UK accounts for only 1.1% of global fossil-fuel use which shows no sign reduction as energy demand increases in large countries like China and India and the rest of the developing economies. So there is little prospect of global GHG coming down sufficiently and we have no choice but to adapt to the consequences of any future warming. Humanity has coped very well with a warming of about 1.2C over the past century – every measure of human wellbeing has improved significantly in spite of a quadrupling of the population. So we should be optimistic that we can similarly adapt to future warming through technology and human ingenuity. In any case we will have to; there is no choice.  There needs to be far more focus to make societies more resilient to the consequences of future warming rather than on trying to meet made-up targets which will have little impact on global GHG levels. Every technology relevant to energy use needs to be continuously improved and sensibly implemented – no single approach can work. Engineers will have to play a central role in this endeavour.  Professor Gautam Kalghatgi, Oxford From ' your letters '- IMechE https://lnkd.in/daKS9GJh

Over 118 countries agreed to triple installed global #renewableenergy (RE) capacity to at least 11,000 GW by 2030 at the UN Climate Summit. However, India did not sign the global pledge even though it has signalled its support for clean energy at the #G20 Summit held in New Delhi. "It is a missed opportunity for India despite taking leadership position on tripling of renewable energy at G20. The reason for not signing the pledge is to do with some language on #coal phase out, which it wasn’t comfortable with. India with its growing development and #energy demand needs, is not ready to commit to coal phase-down as of now," says Institute for Energy Economics and Financial Analysis (IEEFA)'s Vibhuti Garg via CNN-News18 | Srishti Choudhary. Read the full article 👇: https://lnkd.in/dxzu2DsX

2023 renewables installations blew past 2022's total by 50%! Absolutely something to celebrate. 2023 report card 👇🏼 🌍 The surge in renewable energy last year brings us closer to tripling global capacity by 2030, as per the International Energy Agency's report. HOWEVER, we're not on track to limit global warming to 1.5°C regardless what COP28 said. Some good stuff 😃 ...and bad stuff 😢 ... 🔥 The recent UN climate summit agreement will reduce the emissions gap by only c1/3 by 2030....only 1/3 😢 🌱 Almost 200 countries aim to triple renewable capacity to 11,000 GW by 2030 and double energy efficiency improvements. 😃 📈 The IEA reported a 50% increase in renewable energy capacity in 2023, with China leading the way. 😃 and 😢 in that other large emitters need to get on that trajectory! Looking at you India... 🌏 Global growth is encouraging, but while we need more contributions from emerging and developing countries, especially in Africa and Latin America. 😃 , but if you read below... 📊 Progress is uneven, with many emerging economies struggling to finance clean-energy projects. International financial support is crucial. 😢 🛢️ Fossil fuel demand must decrease by 25% by the end of this decade to limit global warming to 1.5°C. x3 renewables by 2030 threatens the fossil fuel industry, and we're moving towards reduced fossil fuel use. 😃 🌡️ The world is already 1.1°C warmer, making the 1.5°C target challenging but essential. 😢 But enough of looking behind us, let's look at 2024! Read OWC CEO William Cleverly's look ahead at 2024! Forgive him his taste in football! 👉🏼 https://lnkd.in/eWa3HBKZ #Renewables #OffshoreWind #OnshoreWind #Solar #BESS #ClimateChange #Hydrogen --------------------------------------- 📞 📧 Contact me or OWC if you want to chat about support for your renewable energy project, investment, or market entry. ➡ Subscribe to the loudest, most seriously caffeinated #offshorewind newsletter on LinkedIn 👉🏼 https://lnkd.in/erRNk4MB