Tomato soup over Van Gogh’s Sunflowers in the National Gallery? (The painting was protected by glass, but the protestors are being prosecuted for damaging its frame.) You can agree with the goal, ending our global addiction to fossil fuels, but wonder at the methods of achieving it. And not just because, environmentally speaking, beef consommé would carry more symbolic charge. Nor because such protests provide another excuse for the authoritarian provisions of the Public Order Bill courtesy of Home Secretary, Suella Braverman, and her predecessor Priti Patel.
What is the Just Stop Oil activists’ theory of change at work here? It seems unwise to alienate those who maybe agree with your goal or who are open to persuasion, those who enjoy what John Stuart Mill called the ‘higher pleasures’ of viewing great art or are tired and infuriated Londoners trying to get to work. Yet, such newsworthy public protest is understandable. Just Stop Oil attempted to block UK oil terminals and shifted tactics after injunctions brought risk of court convictions for contempt. Parliament, they argue, has failed to date to combat climate change effectively, a reason some environmental groups conclude that only direct action can save the planet. But civil resistance needs to educate, recruit and internationalise rather than just disrupt and irritate. Some shared understanding of precisely who, where and what needs worldwide resistance, what those seeking to curb carbon emissions are up against, would help.
Few of us, for example, grasp the dynamics of the oil/fossil fuel juggernaut, both the profit-seeking private sector and income-generating nationally owned oil companies; the magnitude of their operations and infrastructure, the geopolitical significance of fracking, now in the news, the future of shale deposits, the energy demands of the massive economies of the Asia-Pacific. The Canadian Professor, David A. Detomasi teaches a course on this subject at the Business School of Queen’s University’s Toronto campus. His Profits and Power: Navigating the Politics and Geo-Politics of Oil, (University of Toronto Press), offers enlightening figures.
We are accustomed to flattering self-portraits painted by private sector oil companies showing themselves mutating into responsible energy companies The ‘supermajors’ for example Royal Dutch Shell, Exxon-Mobil and Chevron presenting themselves as if they were the commercial wing of the Green movement. Detomasi’s figures are revealing. The costly advertising messages only weakly relate to reality. Whatever the official investment targets, in 2018 only 1-5% of overall expenditure went on increasing the proportion of renewables within their energy offering. Targets for renewable investment have since risen. But few believe they will be achieved. In contrast, in 2016 exploration and drilling expenditures were: ExxonMobil $19 billion, Shell $25 billion, Chevron $26 billion – and this was down considerably on 2014. And the six largest supermajors are only responsible for about 15% of global production. The national or nationally-directed giants, Saudi- Aramco, Rosnet, and those of Iran, Kuwait and China produce the majority of the world’s oil.
For the period 2016-2019, total ‘upstream’ expenditure by oil producers globally, including the national companies, supermajors and smaller players is estimated as $400-500 billion dollars. These are not sums you’d expect if serious reductions in production and use in the 2020s were planned. They appear more indicative of a future in which deadly amounts of fossil fuel will be found, shipped, sold, refined and used. And this can be seen as the response to the Paris COP21 conference’s legally binding treaty to limit greenhouse gas warming to well below 2 degrees, preferably 1.5C, signed on 12 December 2015 by 196 countries.
Profits and Power is a telling title for Detomasi’s book. He is indicating that oil companies’ behaviour will continue to be determined by calculations of costs and returns on barrels of oil extracted and sold. Global annual oil production rose from 64.8 million barrels a day (mbd) in 1980 to 99.2mpd in 2019 with the USA alone consuming 20% of the total, 20.5mbd, and the EU less per capita but 14mbd. India with a current population of 1.4 billion consumes 3.7mbd a figure set to increase to 10mbd by 2040. Power comes out of oil barrels as well as guns.
Oil profits depend on ease of extraction and, of course, demand. Overproduction glutting the market lowers the price. Government reserves and income influence the amount of oil being extracted. Saudi-Aramco, sitting on fields discovered in 1948 whose oil is still relatively easily extracted, is calculated to be worth today two trillion dollars, the second highest market capitalisation of any company in the world after Apple. So Saudi Arabia is the most able to ride out global reductions in oil price and can safely cut production to push up price. Highly efficient oil companies such as Chevron make profits even when oil price slumps; in the fourth quarter of 2014, after months during which the oil price had halved, Chevron recorded a $3.5 billion profit.
Tax revenues from oil production and consumption are politically significant whatever the government. Taxes on Russia’s oil and gas revenue have been accounting for over a third of Putin’s federal budget. For every $1 dollar increase in the global oil price it has been calculated that c. $1.9 billion flowed into the Russian exchequer, with at least some of it going into offshore bank deposits of Putin and his oligarchs. He is now being forced to raise taxation with unpredictable consequences in a population already showing signs of war weariness. This is another powerful player in the complex global behemoth against which Just Stop Oil pitches itself calling for a complete halt to licensing, development and production of fossil fuel exploration in the UK.
As Putin has demonstrated it is the power of oil-rich governments, trapped in the ‘oil curse’ of corruption and failure to diversify that is the major problem. The USA is amongst the top three producers with 33 of its 50 states rich in oil and gas plus some drilling in the Gulf of Mexico providing wriggle room. President Biden has felt able to throw his weight behind the latest COP climate change conferences. Cheap and flexible fracking – easy to shut down and restart - almost halved US oil imports in the last two decades and this has facilitated the swing in foreign policy focus from the Middle East to the Asia-Pacific. It has given the US Democrats a degree of immunity to Putin’s energy blackmail that currently besets Europe.
By way of a conclusion Detomasi presents climate change not as an existential threat to human civilisation, a qualitatively different level danger, but just one of many forthcoming problems confronting a world economy dominated by oil and gas. Doubtless the dominant view from the oil industry, an informed one, but clearly not the assessment of climate scientists.
Governments and States through their economies and national oil companies are heralding the four horsemen of the apocalypse. This does not exculpate the supermajors. They too are going to have to change quickly and move fast and with far more determination and money. They need to demonstrate to the world that commitment to renewable energy sources is not a path to bankruptcy. Meanwhile a substantial UK windfall tax on their profits should go straight into a sovereign wealth fund to protect the poor from debilitating energy costs with funds set aside for subsidising research on renewables and carbon capture.
So far the desperate young people of Just Stop Oil have been getting arrested in their hundreds with discrepant effects on public opinion. Perhaps the world faiths can find a better way to persuade us all that we must change our habits of consumption, shun fossil fuels and end blinkered promotion of indiscriminate economic growth. The global religions are in a unique position to transcend the lethally narrow vision of national interest and national security that prevails, and have much to say about both profits and power. Pope Francis’ encyclical Laudato Si provided a foundational document for fundamental change. But it needs serious attention and political action not dismissal as naive and utopian.
See TheArticle 21/10/22