ABU DHABI, United Arab Emirates — Energy ministers from across the developing world gathered in the emirate of Abu Dhabi on Monday and stressed the need for continued investment in fossil fuel production — a message just days after these same nations joined around 200 countries in accepting a compromise deal aimed at limiting rising global temperatures and curbing greenhouse emissions.
Energy ministers from two key OPEC nations — the United Arab Emirates and Saudi Arabia — pointed to the rising price of natural gas and the energy crunch this has created in Europe and China as examples of what happens when demand outstrips supply. They say this has raised the price of energy across the board, impacting oil prices now hovering around $80 a barrel.
"After almost a decade of under-investment in our industry, the world has sleepwalked into a supply crunch. It is time to wake up," said Managing Director and CEO of the Abu Dhabi National Oil Company Sultan Al-Jaber.
The remarks came at the start of the annual Abu Dhabi International Petroleum Exhibition and Conference.
Al-Jaber argued over $600 billion annually will need to be invested in the oil and gas industry until 2030 — just to keep up with expected global demand. Al-Jaber, who is also chairman of Abu Dhabi's renewable energy firm Masdar, said that while a future run on renewable energy is coming "it is not here yet" and the world is still heavily reliant on oil and gas.
President Joe Biden's administration, while rallying nations to shift away from burning fossil fuels, has simultaneously called on OPEC to increase production as prices climb for consumers at the pump, including singling out Saudi Arabia. Major oil producers in the OPEC+ group have so far refused to veer from their gradual approach of restoring production levels slashed amid the pandemic of 2020.
UAE Energy Minister Suhail al-Mazrouei told The Associated Press that the OPEC+ group, which includes Russia and other non-OPEC oil producers, is relying on independent technical data that shows there will be a surplus of oil early next year.
In 2022, in "the first quarter, we will have a surplus of supply than the demand," he told The Associated Press at the ADIPEC conference. "The balance will not be negative, (it) will be positive."
Saudi Energy Minister Prince Abdulaziz bin Salman rejected any suggestions of political pressure by the U.S. to pump more oil.
"There is always a dialogue. I don't think the media is tagging it with the right name. It's called dialogue and discussions," he told journalists in Abu Dhabi.
The deal reached in Glasgow, Scotland on Saturday by nations around the world contained a last-minute change that watered down crucial language about coal. Several countries expressed disappointment by the change promoted by India to "phase down," rather than "phase out" coal power, the single biggest source of greenhouse gas emissions.
India's Minister of Petroleum and Natural Gas, Hardeep Singh Puri, told the audience in Abu Dhabi that his nation was a the forefront of the energy transition and seemed to try and suggest India wasn't behind that change in wording. He also brushed aside criticisms of India's pledge to reach net-zero by 2070, which skeptics have described as making a mockery of the global effort to cut emissions.
"Our per capita consumption of energy compared to global averages is about one-third," he said, but added the figure is quickly rising amid India's population boom and economic growth.
Puri warned against an energy transition that results in unrealistically high costs for consumers. He said it was important that the ADIPEC conference in Abu Dhabi was being held just after the COP26 summit in Glasgow so focus can be on "both on what the reality on the ground is and the need to manage the transition."