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“The scenario of a carbon-free global economy should strongly impact the revenues of the hydrocarbon producing States”

Tribune. The current surge in energy prices comes in a context where the climate is viewed as a priority. Paradoxically, while the priority would be the climate, consuming countries are demanding more fossil energy from the Organization of the Petroleum Exporting Countries and its allies (OPEC +), and it is reluctant.

Why ? Because consumers want to lower prices, in particular to contain inflation and consolidate the current economic recovery. Conversely, the OPEC + countries want to replenish their budgets and guarantee their future income in the context of the announced decline in the consumption of fossil fuels – oil, gas and coal.

This contradiction of objectives, on the two camps, results in a non-cooperative system that undermines the climate priority and its energy transition component. To respond to this contradiction, we need to better articulate the meaning of the energy transition for fossil fuel exporters.

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In countries that depend on oil and gas, most of the financing of the economy relies on exports of these two products. Hydrocarbon exports represent, for example, nearly 70% of Saudi Arabia’s total exports, 85% of Algeria’s, and almost 100% for Iraq.

These countries, along with ten others, are part of OPEC. OPEC members represent just over 70% of the world’s oil reserves. The exploitation of oil and gas therefore structures the economic life of these States, which are at the same time the key players in the functioning of the world markets for these hydrocarbons.

Hydrocarbon exports represent nearly 70% of Saudi Arabia’s total exports, 85% of Algeria’s, and almost 100% for Iraq

But the global trend towards decarbonization is stimulating investment in clean energy, which ultimately threatens hydrocarbon-exporting countries. The share of renewable energies in the global energy mix, currently estimated at 17% of final energy consumption, is set to increase. This increase in low-carbon energy sources should lead to a reduction in the use of hydrocarbons and a drop in their prices.

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Under the 2 ° C increase scenario, the Middle East, which holds the majority of conventional oil reserves, could leave 38% of its reserves underground. The region could also leave 61% of its gas reserves underground. The scenario of a carbon-free global economy should therefore have a significant impact on state revenues, and a posteriori on the stability of the region with potential chain reactions, as can be observed for Libya, Iraq or Syria.

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