INDUSTRY
ANALYSIS
OIL AND GAS FOSSIL FUEL USAGE
Global temperatures could rise by more than 3°C and the world economy could shrink by 18% in the next 30 years
Can the global economy survive without fossil fuels? IF CORRESPONDENT
As the news regarding climate change becomes more and more alarming, we have also come to understand that humanity’s use of fossil fuels is severely damaging our environment. Fossil fuels cause local pollution where they are produced and used, and their ongoing use is causing lasting harm to the Robots climate of our entire planet. either allow Nonetheless, meaningfully surgeries to changing our ways has been be performed very difficult. In 2020, the with better Covid-19 pandemic brought accuracy than trade, travel, and consumer unsubsidized spending to a near-standstill. human With billions of people surgeons or recently under stay-at-home allow remote orders and economic activity surgeries plunging worldwide, the demand for and price of oil have fallen further and faster than ever before. This has made some experts ask the question if this crisis could be the push the world needs to move away from oil. One asked: “Could the coronavirus crisis be the beginning of the end for the oil industry?” Another: “Will the coronavirus kill the oil industry and help save the climate?” In 2020, the annual greenhouse gas emissions declined by 4-7 percent due to the world coming to a standstill and some of the world’s most polluted
58 | Jan - Feb 2022 | International Finance
cities enjoyed clear skies. The idea that a pandemic could help ave the planet misses crucial points. Firstly, damaging the world economy s not the way to deal with climate change. When it comes to oil, we still need to find a suitable replacement. in terms of its availability and fitness for purpose. Although the supply is finite, oil is plentiful and the technology to extract it continues to improve, making it ever-more economic to produce and use. The same is also largely true for natural gas. Having said all of that, climate change is very real and we are seeing its more clearly than ever. Fossil fuel usage has roughly doubled since 1980, however, in the present day, coal consumption is falling in many parts of the world. Oil and gas usage, on the other hand, is still growing. Data shows that despite alternative energy sources such as renewables have become cheaper comparatively, the share of fossil fuels in the world’s energy mix still remains high compared to a decade ago. According to a report by REN21, fossil fuels’ share in the global energy mix was 80.2 percent in 2019, compared to 80.3 percent in 2009. The report further revealed that renewable energy share in the energy mix has grown to 11.2 percent in 2019 from 8.7 percent in 2009. In 2019, we witnessed 15 extreme weather events, primarily as a result of climate change and caused more than $1 billion in damage each. . Four of these events each caused more than $10 billion
