Saudi Aramco CEO: Rethinking the Energy Transition – $9.5 Trillion Investment Questions Affordability vs. Renewables

Amin H. Nasser, the CEO of the world’s biggest oil producer, Saudi Aramco, just threw a wrench into the works at the recent CERAWeek energy conference in Houston. Forget this whole “ditch oil and gas completely” thing, he says. Let’s focus on keeping energy affordable for everyone, while still reducing emissions.

Nasser’s pushing back on the idea of a super-speedy switch to solar panels and wind turbines. He says these clean energy sources just aren’t there yet in terms of meeting the world’s energy needs. Right now, fossil fuels like oil and gas are still king, accounting for a whopping 82% of global energy use in 2022. That number might have dipped a bit recently, but oil consumption is actually still growing, especially in developing countries.

Here’s the thing: everyone loves the idea of going green, but nobody wants their energy bills to skyrocket. Nasser points out that despite pouring over $9.5 trillion into the energy transition over the past 20 years, we’re not seeing the kind of results we’d hoped for. Renewables and electric vehicles (EVs) are still pretty niche, only supplying a measly 4% of the world’s energy.

So, what’s the solution? Nasser proposes a “reality check” on the energy transition. We need to be honest about how much energy the world actually needs, and invest accordingly. Oil and gas are still affordable and reliable, and they’ll be crucial for meeting growing energy demands, especially in developing economies.

Nasser isn’t suggesting we abandon all hope for a greener future. He acknowledges the environmental impact of the oil industry, and emphasizes the need to cut carbon emissions, improve efficiency, and invest in cleaner technologies. But he also recognizes the financial strain people are facing right now. Rising energy costs are a major headache for folks in places like the US and the UK, forcing governments to step in and offer relief.

Nasser’s message is clear: let’s not get carried away with the latest clean energy fads. Technologies like hydrogen and EVs have potential, but they’re still expensive and haven’t quite won over the public yet. We need to find ways to make them more affordable and address people’s concerns before we can truly rely on them.

The bottom line? The energy transition is a complex beast. Nasser reminds us that we need to find a way to balance our environmental goals with the very real need for affordable and reliable energy for everyone. It’s all about finding sustainable solutions that work for both the planet and our wallets.

Also read: Saudi Aramco Reports 23% Decline in Q3 Profits Due to Lower Crude Prices and Volumes