Oil as Part of the Solution
Oil as Part of the Solution
When the G20 was established in 1999, neither environment nor climate change were on its agenda. The aim was to bring together the most important industrial and developing economies within a global forum that strives to achieve economic and financial stability. However, the Group’s most recent summit held in Riyadh changed this picture, with the most prominent manifestation being the clear will of the session’s Saudi presidency to place sustainable development and environmental issues at the forefront of priorities.
Environment and sustainable development took over more than a third of the leaders’ final statement, under a section entitled "Ensuring a Sustainable Future". This highlighted a clear belief that economic development cannot be sustained in isolation from environmental protection and sensible management of natural assets. The statement was not limited to general jargon, but rather went into detail, committing to the most pressing challenges of our time: preventing environmental degradation, sustainably harnessing natural resources and restoring biodiversity, promoting clean air and clean water and tackling climate change. The leaders linked economic recovery plans from the corona pandemic to preserving the planet and building a more sustainable future, which necessitates directing investments towards a green economy, based on the efficient use of resources, ensuring regeneration and reducing carbon emissions. The leaders also committed to conserving marine and terrestrial environment, including protecting coral reefs, achieving a 50 percent reduction of degraded land by 2040 and reducing additional pollution by marine plastic litter.
It was natural for the issue of energy to occupy a central spot in the discussions of a summit chaired by one of the biggest oil-exporting countries. The closing statement called for diversification of energy sources and relying on innovation and technology options, to deliver affordable and reliable energy for all. The statement also stressed the importance of tightening efficiency standards, reducing emissions and the “phasing-out of inefficient fossil fuel subsidies that encourage wasteful consumption, while providing targeted support for the poorest."
The concept of "circular economy", which is based on rationalizing the consumption of resources by adopting the 3Rs of reduce, reuse and recycle, has been prominent in the work of the G20 for many years. However, Saudi Arabia has put its mark on the last summit by embracing the "circular carbon economy". This 4R concept adds a fourth principle, remove, which makes achieving a totally carbon-free circular economy more realistic, by seeking cleaner and safer ways to use fossil fuels during a transition period. It is true that this concept has been flowing in academic circles for years, but the Riyadh summit turned it into an operational plan of action.
Until now, some have taken the hurdles facing the elimination of carbon emissions within a short span as an excuse to continue using polluting sources with no mitigation measures. The circular carbon economy is based on managing emissions in all sectors, by rationalizing consumption, developing technologies for safe carbon collection and storage, and protecting oceans and forests to enhance their ability to absorb carbon. Thus, the calculation shifts from the total amount of carbon emitted to the amount that remains in the atmosphere after its recovery, by collecting it at the source and providing suitable conditions for its safe absorption in nature, storage or by developing techniques appropriate for reuse in useful processes and products. This goes hand in hand with boosting investments in carbon-neutral renewable energies, and its success depends on making carbon capture and storage, alongside reuse, technically and economically safe and feasible. Although the goal is worth fighting for, it represents a tough challenge, as capturing and safely reusing or storing carbon is still a very costly process, especially compared to ever decreasing cost of renewables, mainly solar.
The Riyadh summit reiterated its commitment to the Paris climate agreement regarding reducing carbon emissions, including mobilizing USD 100 billion per year to address the needs of developing countries to reduce emissions and adapt to changes including sea-level rise, health, water supplies or agricultural production. It is worth noting that food and water security and human health occupied a prominent spot in the summit discussions and featured in its resolutions.
Under its Saudi leadership, the summit highlighted a new approach in dealing with energy and climate issues, not previously explored. It is a proactive approach that does not hide from challenges, but rather faces the problem and proposes a solution as part of the positive international endeavors. The time for denying climate change and working with any party, even with a rogue state, to derail international consensus, is long gone. Acknowledging the problem while engaging in action to develop solutions, gives oil-exporting countries a leading role in deciding on alternatives that preserve their rights to properly harness their natural resources and diversify their economies, instead of putting themselves in the villain’s seat, accused of being solely responsible for global carbon emissions. These countries maintained global energy security for decades, which resulted in prosperity and stability, while carbon emissions alarmingly increased due to wasteful consumption and the failure of industrialized countries to develop efficient and clean technologies in pursuit of hasty profits driven by greed.
The involvement of leading oil exporters in international efforts to confront climate change, by committing to reduce carbon emissions, through implementing efficiency measures, managing carbon and switching to clean and renewable energy options, alongside building resilience by diversifying the economy, makes oil itself part of the solution rather than solely part of the problem.
The environmental and climate message of the presidency of the G20 summit in Riyadh was clear: We want to be part of the solution, so let each country make its fair contribution according to its share of responsibility.