The coronavirus has dealt the fossil-fuel industry the biggest single blow in its history, and it is clear that 2020’s plummeting demand for oil and gas is no mere flesh wound. The global Covid-19 crisis may have already triggered a terminal decline for big oil. BP’s decision last week to reset its oil price forecasts for the next three decades was the latest tremor in a seismic shift for the industry. Its forecasts of a $75-a-barrel oil price over the next 30 years were scrapped in favour of an average price of $55. The watershed decision wiped more than $17bn from the value of its business at a stroke and could mean many of its untapped oil reserves will remain in the ground. The transition to a renewable future featured prominently in BP’s statement. Chief executive Bernard Looney said: “These difficult decisions – rooted in our net-zero ambition and reaffirmed by the pandemic – will better enable us to compete through the energy transition.” The company added that the pandemic would probably “accelerate the pace of transition to a lower-carbon economy and energy system”. It is a clear acknowledgement that the progress of the green transformation is unstoppable, only weeks after Royal Dutch Shell too bowed to the inevitable decline of oil industry returns. Shell revealed a dramatic rebasing of its shareholder dividends, wiping three-quarters from the annual payouts expected this year, in its first dividend cut since the second world war.
Observer 21st June 2020 read more »
UK’s largest North Sea oil producer delays £323m worth of drilling projects. Oil producer Chrysaor will cut spending by almost a third this year.
Telegraph 20th June 2020 read more »