United Nations Secretary General Antonio Guterres warned on June 14th that the window to prevent the worst impacts of the climate crisis is closing. While the Secretary General has issued such warnings multiple times before over the last several years, he is now upping his war of words against the fossil fuel industry. He added that new funding for fossil fuel exploration and production infrastructure is “delusional” and called upon all financial actors to abandon fossil fuel finance.
“We just think that investments in fossil fuels, new drilling are dead‑end investments"
I asked the spokesman for Secretary General Guterres to explain Mr. Guterres’ characterization of any further funding for fossil fuel exploration and production infrastructure as “delusional” while people today are suffering from the historic surge in energy prices.
After stating that one way to deal with the energy crisis would be to end the war in Ukraine, the Secretary General’s spokesman said: “We just think that investments in fossil fuels, new drilling are dead‑end investments and that we should focus our energy and our funding on renewable energies.”
In support of this proposition, the spokesman cited “many reports from experts” and examples of “the weather we're having in parts of the US” and “the situation in parts of the Horn of Africa.”
“We think that new investments in carbon tech... in carbon energy, burying more money in drilling for oil and digging for coal will just lead to more misery, to put it mildly,” the spokesman added.
The clear and present danger today is the shortage of usable fossil fuels
Secretary General Guterres doubled down in his remarks that he delivered virtually on June 17th to the Washington, D.C. Major Economies Forum on Energy and Climate. “Now nothing could be more clear or present than the danger of fossil fuel expansion,” he said. “Even in the short-term, it doesn’t make political or economic sense.”
With all due respect, the UN bureaucrats are the ones who are “delusional.” The clear and present danger today is the shortage of usable fossil fuels, which has driven up the price of not only gasoline but the prices of all of the other many products that rely on fossil fuels.
People are miserable today because of what they have to pay to fill their gas tanks, to use electricity in their homes and businesses, and to put food on the table. Fossil fuels are still required inputs for all of these necessities of life. Expanding fossil fuel exploration and production is the only available remedy at hand to help alleviate people's misery right now due to energy shortages.
Even U.S. President Joe Biden, who has done everything he could since taking office to follow through on his campaign promise “to end fossil fuels,” is now demanding that U.S. oil companies “take immediate actions to increase the supply of gasoline, diesel, and other refined product.”
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Fossil fuel is also used across the entire food production and supply chain systems
Until the cost of electric cars becomes affordable for the average driver and the infrastructure is in place for widespread, operational charging stations, internal-combustion engine powered vehicles are here to stay for the foreseeable future. Investments to fund more oil drilling and refinement to increase the supply of gasoline, diesel, and other oil products are necessary at least in the intermediate term to keep the engines running.
Fossil fuels are the largest sources of energy for electricity generation. Natural gas is a relatively clean source of fossil fuel energy, certainly as compared to coal upon which China in particular remains dependent. It makes sense to invest in the production and transport of natural gas for use in steam turbines and gas turbines to generate electricity, at least in the intermediate term until comparably reliable alternative sources of renewable energy are developed and widely deployed.
Fossil fuel is also used across the entire food production and supply chain systems. Everything from the tillage of land, the manufacture of fertilizers and farm equipment, and generating electricity used on farms to food processing, packaging, transportation, and delivery today still rely on fossil fuels. And they will continue to rely on fossil fuels for the foreseeable future.
High rates of hunger have a devastating impact on individuals, families, and societies
UN Secretary General Guterres himself has warned of more global food shortages in the coming months. “In the past year, global food prices have risen by nearly one-third, fertilizer by more than half, and oil prices by almost two-thirds,” he said last month in his remarks to the Global Food Security Call to Action Ministerial meeting hosted by United States Secretary of State Antony Blinken.
“High rates of hunger have a devastating impact on individuals, families, and societies,” the Secretary General noted. He offered several steps to address the food shortage crisis, the first of which would be to “urgently reduce the pressure on markets by increasing supplies of food and fertilizers.”
But he left out the critical linchpin to make this happen – to urgently expand the supply of energy. And at least for intermediate term, this means expanding the supply of usable fossil fuels.
Food industries are more sensitive to energy price changes than are nonfood industries
There is a direct causal relationship between the rising costs of food and fertilizer on the one hand, and the cost of energy on the other. As the U.S. Department of Agriculture has noted, “Food industries are more sensitive to energy price changes than are nonfood industries.”
The only game in town right now to reduce the pressure on the interdependent food and energy markets is to immediately expand the supply of usable fossil fuels.
You can’t just cut the global economy’s umbilical cord to fossil fuels immediately without producing even more misery.
Investments to enable an orderly transition to alternative renewable energy sources and investments now to fund fossil fuel exploration and production infrastructure to alleviate the current worldwide economic crisis are not mutually exclusive. To the contrary, they can complement each other in helping to alleviate people’s suffering – both today and tomorrow.
United Nations Secretary General Antonio Guterres warned on June 14th that the window to prevent the worst impacts of the climate crisis is closing. While the Secretary General has issued such warnings multiple times before over the last several years, he is now upping his war of words against the fossil fuel industry. He added that new funding for fossil fuel exploration and production infrastructure is “delusional” and called upon all financial actors to abandon fossil fuel finance.
