Oil and gas companies urged to adapt amid energy transition
As demand for oil and gas reduces as the world move towards a renewable future, a recent report by Carbon Tracker states the importance of the oil and gas industry to adopt adaptive strategies to safeguard shareholder value.
Despite the current surge in oil and gas prices driving the energy price crisis, the risk of oversupply looms as global demand weakens. This oversupply could lead to price declines and affect project viability.
Mike Coffin, Head of Oil & Gas and Mining at Carbon Tracker, suggests that managed investments in short-cycle projects or natural depletion strategies can mitigate risks.
The International Energy Agency predicts a peak in global fossil fuel demand this decade with ExxonMobil and Saudi Aramco still anticipating demand growth based on OPEC forecasts.
This reinforces the UK governments position who have stated that electricity generated from fossil fuels will be a part of the generation mix beyond the point we are net zero in 2050, albeit on a much smaller scale.
Sustainability and security is the key focus for the UK government as we move towards 2050 so we are not influenced so much on what happens across the world as we all compete for the same oil and gas.
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