COP26 is definitely a wake-up call, says OPEC’s Barkindo

The secretary general of the OPEC oil group said the COP26 climate summit in Glasgow was “definitely a wake-up call.”

Speaking to CNBC at the ADIPEC energy industry forum in Abu Dhabi, Mohammad Barkindo was asked if the Glasgow deal, which included a late compromise on coal-related formulations, was ultimately successful.

“I wouldn’t call it a failure,” Barkindo told Dan Murphy. “I think the British presidency has done an extremely good job of getting Paris back on track in Glasgow.”

“Rebuilding the Paris consensus in Glasgow is no easy feat if you follow the cracks we saw after the United States left,” he added.

The Paris Agreement, adopted in 2015, aims to “limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.”

The challenge is daunting, and the United Nations has noted that 1.5 degrees Celsius is considered the “upper limit” when it comes to preventing the worst impacts of climate change.

The COP26 deal aimed to build on that and prevent the worst impacts of climate change, although it faced obstacles related to phasing out coal, fossil fuel subsidies and financial support to low-income countries.

India and China, some of the world’s largest coal producers, have pushed for a last-minute rewording of the fossil fuel agreement from coal phase-out to phase-out. After initial objections, the opposing countries ultimately ceded.

For his part, Barkindo was generally positive about the result. “I think that John Kerry and his team, together with [Alok] Sharma, President of COP26, has done an amazing job of rebuilding the consensus that was broken after Paris, ”he said.

“Because without that consensus, it would have been impossible to get a climate pact in Glasgow.”

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Looking ahead, Barkindo firmly believed that fossil fuels would be essential in the years to come.

“There is no doubt that the scientific fact that oil and gas will continue to play an important role in the global energy balance for the foreseeable future is beyond question,” he said.

His comments echo those of BP CEO Bernard Looney, who told CNBC on Monday: “It may not be popular to say that oil and gas will be in the grid for decades to come, but it is reality.”

Oil industry

When it comes to More broadly, Barkindo stressed that the oil industry has been negatively impacted for a number of years by both low prices and falling investment.

“We never recovered from the 2014-2016 recession, when for two consecutive years we saw almost 25% annual decline. [in investment], and then last year came Covid, shrinking the industry by about 30%, ”he said.

“With all the challenges of accessing capital, the industry needs to wake up … and face reality.”

This reality seems to be becoming increasingly hostile to fossil fuels. For example, in his speech at COP26, UN Secretary-General António Guterres left the world no doubt about his views on this issue.

“Our addiction to fossil fuels is putting humanity on the brink of an abyss,” he said. “We are faced with a sharp choice – either we stop him, or he will stop us.”

Guterres added that it was time to say enough.

“It’s enough cruelty to biodiversity, enough to kill ourselves with carbon, it’s enough to treat nature like a toilet,” he said. “Stop burning, drilling and digging deeper. We are digging our own graves. ”

Matt Clinch and CNBC’s Sam Meredith contributed to this report.

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