Jamal Issa Al-Loughani, Secretary General of the Organization of Arab Petroleum Exporting Countries (OAPEC), predicted that the world would become primitive if oil-producing countries listened to climate activist demands and stopped producing gas and oil.
He said the world will witness major power outages, companies would be forced to close and global trade would come to a halt.
Without fuel, supply chains that primarily rely on trucks, railways and marine shipping will come to a stop, he told Asharq Al-Awsat.
Moreover, this will lead to the collapse of the global health system that relies on oil and gas in operating hospitals and transporting patients. The collapse will extend to the production of medicine, equipment and medical supplies, he added.
Ultimately, the world will fall into a deep global slump, he warned.
He remarked however, that given this bleak outlook, the scenario is highly unlikely to unfold.
“We must stress that there can be no imagining a global economy that is not driven by the main engine that is the oil and gas industry,” he declared.
Oil and gas are the main factors on which economic relations between nations are based, providing millions of jobs across the globe, Al-Loughani said.
He noted, however, the growing number of challenges in developing the oil industry and coordinating energy policies between OAPEC member states. He cited unified efforts to secure the delivery of oil to markets through fair and reasonable conditions and providing the suitable conditions for capital and investors in the petrol industry among members.
This is one of the main goals of OAPEC, he remarked. One of the hurdles facing it, he continued, are misleading calls for reducing investments in oil and gas related to the environment and climate change.
He said there is a great insistence on tying an emissions-free environment to reducing the consumption of oil and gas. These calls omit the fact that producing oil and gas and controlling emissions through clean technologies help reach the goal of net-zero emissions by 2050.
OAPEC has indeed started to implement this in recent years as part of the aim to bolster sustainable energy systems and contribute to the global climate change efforts, Al-Loughani added.
OAPEC was founded by Saudi Arabia, Libya and Kuwait in Beirut in 1968. It is based in Kuwait and its founding was viewed as an Arab accomplishment amid trying conditions that followed the 1967 war.
Energy and emissions
Al-Loughani stressed that the oil and gas industry played a major role in the growth of the global economy in recent decades.
In spite of the pressure it is coming under by some countries that had initially backed it, the industry will certainly continue to play its role in the future, he stated.
He emphasized that OAPEC has started to meet global trends related to reducing carbon emissions.
He noted the constant investment, innovation and development of clean technologies, such as carbon capture and storage.
Al-Loughani remarked however, that demand on oil and gas will continue to remain great in the global energy mix despite the rise in the share of renewable energy, especially solar and wind power.
Oil markets
On the drop in investments in the oil sector after some countries shifted to clean energy, Al-Loughani acknowledged the decline, especially in production and exploration, which will lead to a slowdown in the growth of global reserves.
This in turn may impact overall supplies to meet growing demand and consequently lead to rises in energy prices, he predicted.
He revealed that oil exploration and production investments reached around 397.6 billion dollars in 2023, meaning there is a gap estimated at over 17 percent in investments needed to meet global oil demand until 2045, which is estimated at 480 billion dollars annually, according to OPEC.
So, there is a need to bolster investments in the oil industry overall to avoid jeopardizing global energy security and increase inflation, which will in turn slow down the shift towards a clean sustainable energy system, he urged.
Arab reserves
On the role of Arab countries, specifically Saudi Arabia, in securing oil supplies to the global energy market, he said they are playing a main role to that end given their massive reserves and share of global production.
He stressed that Saudi Arabia constantly strives to ensure the security of oil supplies and provide trusted sources of energy, especially when it comes to economic development, while confronting the challenges of climate change.
This has been demonstrated in Saudi Arabia’s pioneering efforts in founding OPEC+ and ensuring its success. He also cited the precautionary measures taken by the group to support the stability and balance of the global oil market through additional voluntary reductions on production.
Such measures are necessary to achieve sustainable growth in the global economy, he added.
He also noted Saudi Arabia’s cooperation with its partners in the G20 with the aim of achieving common interests and maintaining fair costs for all effective parties in the energy market, from producers, investors and consumers. These efforts were highlighted during the COVID-19 pandemic.
