The challenging transition to low-carbon energy requires more government backing

While the International Energy Agency predicts that oil use will peak by 2030, the panellists of the strategic conference titled Meeting escalating global energy demand whilst transitioning to a low carbon energy system were less certain.

“Oil demand is here to stay for a while longer than 2030,’ stated Tengku Muhammad Taufik, President & Group CEO of PETRONAS, the Malaysian multinational oil and gas company.

“In my region, 600 million people still do not have access to safe, affordable energy, and we still need to fill this gap. Whether it’s due to the slow pick up of electric vehicles, or lack of charging stations, the move away from oil may not happen as early as we intended. Before it can happen, we need a very clear dual-fuel strategy and a clearer set of fuel regulations. There's a lot of things to tackle in just five years.”

Wael Sawan, CEO of Shell, also doubted the validity of the prediction. He revealed that Shell’s demand was still at 800,000 to a million barrels per day.

“Certain markets may peak by 2030, but not all of them. The Chinese market will be particularly interesting to watch, and of course, many other markets are actually using more energy, rather than less. As we look towards the 2030s, I think we will be producing more of everything to meet what seems to be a voracious demand for energy around the world.”

With AI being the theme of the summit, Sawan acknowledged that energy demand would continue to grow even without the use of AI, stating that we may even see a resurgence in nuclear energy.

The conflict in the Middle East was cited as a key concern for the panel, as was US-China relations, and energy security.

When discussing what was needed to facilitate the transition to a low-carbon system, Musabbeh Al Kaabi, Executive Director of Low Carbon Solutions & International Growth at ADNOC, said: “When it comes to energy transition, it's clear that we need two key enablers. One of them is advanced technologies - and we've seen a lot of innovation happening in this space – and the other is government policies. To enable new forms of energy to take a bigger role, we need stable regulatory systems and strong government incentive policies. After all, it's going to be a very challenging transition, and we need to encourage big players in the oil and gas industry to commit more capital.”

While the representatives from Shell and Eni highlighted their investments in biofuels and green hydrogen, ADNOC’s strong commitment to decarbonisation was also a strong focus.

“The UAE was the first country in the Middle East to sign the Paris Agreement, and set a net zero target by 2050,” Al Kaabi explained to the global audience.

“The UAE hosted COP28 last year, and the leadership has a strong and clear climate agenda. ADNOC also embodies this same ethos, and we are committed to diversifying our energy. We are investing in solar and embracing carbon capture technology with a target of 10 million by 2030. Trying to decarbonise our operation is no longer an option, but a necessity.”

The establishment of Masdar in 2006 – long before most were investing in solar power - was also mentioned, as was ADNOC’s landmark $23 billion to the low carbon space.

Murray Auchincloss, CEO of bp, admitted that he was surprised at how fast AI had been adopted across the world, and shocked at the huge difference it had made to his organisation's production processes.

“After three months of implementing AI into our processes, we can already see a 30% improvement in cycle time and a 30% improvement in the efficiency of the engineers. I think AI will be the biggest revolution that we will see in our careers in terms of enhancing productivity.”