The Organization of the Petroleum Exporting Countries’(OPEC) decision to cut oil production has led to a stark increase in the price of petroleum products worldwide. The consequences of the resulting supply chain discrepancy are weakening the economies of industrialized nations. The ramifications have been particularly virulent to oil importing countries that do not have the financial means to keep up with raising prices. Oil and its accessibility remain a major input for development across the world, especially within emergent countries. This poses the fundamental question of how we can divest from fossil fuels without impeding the development of marginalized nations.
Fossil fuel dependent countries account for one third of the population, 20 percent of greenhouse gas emissions, and over 80 percent of emissions from oil and gas reserves. The participating nations within the OPEC negotiating block of the United Nations Framework Convention on Climate Change (UNFCCC) have all committed to small, nationally determined contributions(NDCs) by 2030. It is evident that this commitment is not enough. A low-carbon transition is mandatory. There is a careful balance between complying with the Paris Agreement’s 1.5°C temperature increase limit and acting to avoid derailing the current economic system through global energy insecurity and crisis. Fossil fuel dependent countries are at significant risk of economic and social upheaval due to their slim flows in revenue and employment basis in carbon-intensive activities. Furthermore, the climate change effects of these carbon emissions disproportionately affect less affluent nations, regardless of oil importing status.
As the majority of the public envisions a long-term goal of renewable energy development, they create an air of dependence on sociotechnical imaginaries. This rationale prevents people from recognizing the fundamental extractionist logic that dominates capitalist society. Our current system will continue to extract wealth from the working class, extract rights from underrepresented groups, and extract equality from the global system at large. Replacing the extractionist economic model with one of regeneration poses a great threat to the thirteen membering nations of OPEC whose GDP benefits from high oil prices. With a global economy that is dependent on the fossil fuel industry, serious developmental and social ramifications will be observed unless aspects of a just transition are properly considered when developing a low carbon landscape.
Deploying wartime strategies for climate change has become frequently used as an analogy within media in hopes of fueling collective action and reinforcing a sense of urgency in the global community. A key critic of this logic is the danger wartime mobilization has on long term transition making, as this approach undermines the greater good in order to emphasize remediation for the conflict at hand. Rapid conversion of national economies to prioritize militarism, or in this case Environmental Social Governance, requires unprecedented economic and political restructuring in a brief time period. This magnitude of urgent action leads to injustice because it gives rise to power dynamics that block community intervention and thoughtful planning from taking place. As is evidenced by the fallout of Russia’s invasion of Ukraine, OPEC’s support of Russia is coming at the expense of global energy security. The escalating tensions between these countries in cumulation with the destruction of over 50 meters of the Nord Stream Pipeline, as well as Russia annexing four regions of Ukraine has severely strained the sole energy production system that is relied upon by millions of people for energy needs. Current geopolitical issues outline that taking wartime action and rapidly cutting oil production would lower greenhouse gas emissions, at the expense of inflated gas prices, job loss, decreased economic growth, and further perpetuation of energy insecurity.
Similarly, in wake of the 1973 oil crisis, the growth rate of industrialized nations suffered a more severe reduction, despite the hypothesis that developing countries would suffer the most. This was partially related to oil importing, developing countries' lack of complete dependence on petroleum products to fuel their energy demand which emphasized the importance of energy diversification to avoid vulnerability from fluctuating energy costs. The aversion of economic disaster in developing nations caused by increased energy costs was also associated with the sustained demand for foreign workers by OPEC. Domestically, the fossil fuel industry offers stable employment for thousands of American workers. On average in California, fossil fuel workers are 84 percent full time workers, and only 16 percent part time workers, compared to a 61 percent full time worker rate of the total California workforce. The relative stability of working in this sector, which provides 10.3 million jobs nationally, contributes to the societal dependence on the fossil fuel industry. Solutions must address the full scope of supply chain interactions and global employment issues that would result from sudden reductions in oil and gas when creating a low-carbon transition.
When asking petroleum producers to reduce greenhouse gas emissions drastically and rapidly, it is equally important to pursue commercial energy pricing policies that will ensure financial stability and energy security as we pursue sustainability transitions. This becomes difficult when the coalition of petroleum producing nations controls about 40 percent of the global oil supply. Consequently, OPEC+ has great power in manipulating and influencing the short-term free market price of crude oil. Net fuel importers and countries that use relatively less fossil fuel have a fundamental advantage in harnessing opportunities from decarbonization. Funding streams for renewable energy systems to developing countries may help to fill the gap between the specific nations energy budget and power demand, which have been enlarged due to surging oil prices.
A successful transition to a low-carbon economy must utilize the four pillars of a sustainable transition: strong government support, dedicated funding streams, strong and diverse coalition, and economic diversification. Industrialized countries have the means to employ financial incentives to divert the public towards renewables, while implementing asset diversification strategies including: carbon financing, renewable energy, and energy efficiency investment. The duality between collective global welfare and fossil fuel disinvestment must be understood and reckoned with as the transition to a low carbon future is implemented.
Comentários