Can China Shake Its Dangerous Addiction To Oil?
By Haley Zaremba - Feb 14, 2021
In order to avoid the worst effects of global warming, the world will have to make drastic changes this decade. In a damning report released by the United Nations at the end of 2019, that we are on track to see average temperatures soar to 3.2 degrees Celsius (5.8 degrees Fahrenheit) over pre-industrial averages, more than double the amount that experts on the Intergovernmental Panel on Climate Change (IPCC) say is the threshold between us and global climate goals. In a business-as-usual scenario, we will see coral reefs die and dissolve into increasingly acidic ocean waters, coastal cities will be plagued by and even lost to rising sea levels and severe heat will wreak havoc on global weather patterns, agriculture, and ecosystems. In order to avoid the worst of this nightmare scenario, drastic and urgent action is needed worldwide--and this decade will make all the difference. In order to meet the 1.5 degree Celsius target set by the IPCC, we will need to cut oil use by 37% and gas use by 25% by just 2030.
This is why it’s extremely bittersweet news that as the global economy slowly recovers from the novel coronavirus pandemic, oil demand is bouncing back as well. Early in the pandemic, experts called for the global community to take advantage of this unexpected interruption to the status quo and the usually unstoppable inertia of the global economy to create a “new energy order”and a “great reset.” And while the pandemic was the catalyst for a more earnest delve into the clean energy transition than we’ve seen to date, despite the frenzied pleading of climate scientists and activists, the complete green energy boom that some people hope for has not quite materialized.
As the gears of the global industry continue to turn, oil continues to play a major role in the world’s economy. China, the world’s second-biggest economy and single-biggest greenhouse gas producer exemplifies the cognitive dissonance created by the urgency of climate change response and the necessity of getting the economy back on track. China was the only major economy that eked out a modicum of growth in 2020, and they’re now back to business as usual. “But the speedy comeback also complicates a parallel push by Beijing to reach peak fossil energy consumption in this decade and turn the country into a nation of net-zero emissions less than 40 years later,” Bloomberg reported this week.
While Beijing has made very ambitious and very public pledges to go carbon neutral by 2060 and to reach peak emissions by just 2030, these goals are at odds with the country’s equally ambitious economic targets and energy security goals. While China makes lofty promises to phase out dirty energy out of one side of its mouth, the nation has also been returning to coal as a kind of security blanket and ramping up production of the emissions-heavy fossil fuel overseas, directly imperiling global climate goals.
Related: The Most Fragile Oil Price Rally In History
And while coal is indeed a huge part of China’s emissions addiction, China's coal consumption has already peaked. This is not the case for the nation’s crude oil consumption, which continues to rise at a brisk clip. “Over the last three decades, China has been the dominant driver of the global oil market: demand has risen almost seven-fold to more than 14 million barrels a day, according to BP Plc data, turning from an exporter into the world's largest importer,” writes Bloomberg. According to experts both in and outside of China, in order for the nation to reach its own carbon neutrality target, it will have to reach peak oil usage by 2025.
The most recent projections show that China’s oil consumption will likely peak at 740 million tons or 14.9 million barrels per day. “Burning that much extra oil could add 110 million to 146 million metric tons of CO? to the atmosphere a year, as much as the annual emissions of Qatar or Nigeria,” writes Bloomberg. The fate of the world quite literally rests on the shoulders of emissions giants like China (and the United States, which boasts the second-largest emissions footprint despite having a fraction of China’s population) and we are quickly running out of time for global leaders like Presidents Xi Jinping and Joe Biden to lead the charge away from fossil fuels and into the future before the decade ends and it’s too late.
By Haley Zaremba for Oilprice.com
https://oilprice.com/Energy/Crude-Oil/Can-Chi...o-Oil.html
By Haley Zaremba - Feb 14, 2021
In order to avoid the worst effects of global warming, the world will have to make drastic changes this decade. In a damning report released by the United Nations at the end of 2019, that we are on track to see average temperatures soar to 3.2 degrees Celsius (5.8 degrees Fahrenheit) over pre-industrial averages, more than double the amount that experts on the Intergovernmental Panel on Climate Change (IPCC) say is the threshold between us and global climate goals. In a business-as-usual scenario, we will see coral reefs die and dissolve into increasingly acidic ocean waters, coastal cities will be plagued by and even lost to rising sea levels and severe heat will wreak havoc on global weather patterns, agriculture, and ecosystems. In order to avoid the worst of this nightmare scenario, drastic and urgent action is needed worldwide--and this decade will make all the difference. In order to meet the 1.5 degree Celsius target set by the IPCC, we will need to cut oil use by 37% and gas use by 25% by just 2030.
This is why it’s extremely bittersweet news that as the global economy slowly recovers from the novel coronavirus pandemic, oil demand is bouncing back as well. Early in the pandemic, experts called for the global community to take advantage of this unexpected interruption to the status quo and the usually unstoppable inertia of the global economy to create a “new energy order”and a “great reset.” And while the pandemic was the catalyst for a more earnest delve into the clean energy transition than we’ve seen to date, despite the frenzied pleading of climate scientists and activists, the complete green energy boom that some people hope for has not quite materialized.
As the gears of the global industry continue to turn, oil continues to play a major role in the world’s economy. China, the world’s second-biggest economy and single-biggest greenhouse gas producer exemplifies the cognitive dissonance created by the urgency of climate change response and the necessity of getting the economy back on track. China was the only major economy that eked out a modicum of growth in 2020, and they’re now back to business as usual. “But the speedy comeback also complicates a parallel push by Beijing to reach peak fossil energy consumption in this decade and turn the country into a nation of net-zero emissions less than 40 years later,” Bloomberg reported this week.
While Beijing has made very ambitious and very public pledges to go carbon neutral by 2060 and to reach peak emissions by just 2030, these goals are at odds with the country’s equally ambitious economic targets and energy security goals. While China makes lofty promises to phase out dirty energy out of one side of its mouth, the nation has also been returning to coal as a kind of security blanket and ramping up production of the emissions-heavy fossil fuel overseas, directly imperiling global climate goals.
Related: The Most Fragile Oil Price Rally In History
And while coal is indeed a huge part of China’s emissions addiction, China's coal consumption has already peaked. This is not the case for the nation’s crude oil consumption, which continues to rise at a brisk clip. “Over the last three decades, China has been the dominant driver of the global oil market: demand has risen almost seven-fold to more than 14 million barrels a day, according to BP Plc data, turning from an exporter into the world's largest importer,” writes Bloomberg. According to experts both in and outside of China, in order for the nation to reach its own carbon neutrality target, it will have to reach peak oil usage by 2025.
The most recent projections show that China’s oil consumption will likely peak at 740 million tons or 14.9 million barrels per day. “Burning that much extra oil could add 110 million to 146 million metric tons of CO? to the atmosphere a year, as much as the annual emissions of Qatar or Nigeria,” writes Bloomberg. The fate of the world quite literally rests on the shoulders of emissions giants like China (and the United States, which boasts the second-largest emissions footprint despite having a fraction of China’s population) and we are quickly running out of time for global leaders like Presidents Xi Jinping and Joe Biden to lead the charge away from fossil fuels and into the future before the decade ends and it’s too late.
By Haley Zaremba for Oilprice.com
https://oilprice.com/Energy/Crude-Oil/Can-Chi...o-Oil.html
