How should the oil and gas industry respond to net zero?
13 July 2021
In order to stabilise climate change, net emissions of CO2 must be reduced to zero. In the 2015 Paris Agreement, countries agreed to reduce their emissions to keep global warming to “well below 2°C” and pursue 1.5°C. However, oil and gas industry production plans, business strategies and investments are currently not consistent with limiting warming to below 2°C. As a result, fossil fuel producers and their shareholders are at considerable ‘transition risk’ as the world beings to decarbonise.
This policy brief explores the challenges that the oil and gas industry face as we move towards net zero, and recommends solutions for the industry such as climate scenario analysis, decarbonisation, managed production decline and diversification.