The world’s failure to invest enough in fossil fuels before cleaner alternatives can fully meet today’s energy needs is a “recipe for disaster,” Abu Dhabi oil giant ADNOC’s chief executive officer Sultan Al Jaber said at the Bloomberg Emerging + Frontier Forum 2022 in New York.
According to Bloomberg reports, “oil producers have limited ability to react to further disruptions in energy supplies as spare crude capacity is currently less than 2 percent of global demand,” Al Jaber said.
“That doesn’t give a lot of room to maneuver. In fact, it’s a recipe for disaster,” Al Jaber said.
Ever since the pandemic in 2019, oil and natural gas prices have been soaring due to a supply crunch.
This catalysed global inflation, leading the “US to unleash a record amount of crude from its strategic reserves as a way to rein in prices,” Bloomberg said, adding shortage risks have been aggravated by the war in Ukraine.
Much more investment is necessary in technologies to mitigate and eliminate emissions from energy-heavy sectors including manufacturing, construction and agriculture, with “sensible” regulation, tax incentives and “substantial government funding” to help fill the gap, Al Jaber said.
He said the UAE is “fully committed” to the energy transition, though “more realism about the scale of the challenge” is needed to properly address it.
ADNOC has invested $50 billion in renewables, including solar over the past two decades and plans to spend a similar amount in coming years.
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