Ahead of a major OPEC conference, Iraq’s finance minister, one of the founders of the worldwide oil cartel OPEC, has issued an unusual plea to fellow oil suppliers to shift away from fossil fuel reliance and toward renewable energy.
In a letter to the Guardian, Ali Allawi, Iraq’s deputy prime minister, urged oil producers to embrace “an economic revival centered on environmentally sound strategies and technology,” such as solar electricity and maybe nuclear reactors, to reduce their reliance on fossil fuel exports.
“To stand a chance of preventing the worst impact of climate change, the globe requires to radically transform the way it produces and uses energy, consuming less coal, oil, and natural gas,” he wrote alongside Fatih Birol, executive director in charge of International Energy Agency. Livelihoods would be destroyed and poverty rates will rise if oil revenues begin to drop before producer nations have adequately diversified their economies.”
Ministers from the 13 OPEC member countries will meet virtually to discuss possible output cuts as oil prices fluctuate. OPEC had agreed to increase output as nations recovered from the Covid-19 outbreak, but weakening markets have pushed some to urge that the increase should be halted.
Last month, US Vice President Joe Biden made a controversial demand for OPEC to expand oil output even more in order to keep the price of oil from rising and help the US economy recover. His appeal was turned down. According to the Guardian, the OPEC conference on Wednesday may also address the climate catastrophe, in an uncommon gesture for the fossil fuel suppliers, ahead of the crucial UN climate talks known as Cop26, which will take place in Glasgow in November.
Current oil price instability, fueled by the pandemic, according to Allawi and Birol, is simply the beginning of challenges for producers. The climate issue will not only need a shift away from oil, but it will also have a particularly negative impact on the Middle East and North Africa, where increasing temperatures are already posing serious problems. According to the International Energy Agency’s (IEA) recent international roadmap to net-zero by 2050, global oil demand is expected to fall from more than 90 million barrels for every day to fewer than 25 million barrels per day by 2050, likely to result in a potential 85 percent drop in revenues for oil-generating economies.
Economic hardship and rising unemployment risk causing greater unrest and instability in a region with one of the world’s youngest and fastest-growing populations, according to Allawi and Birol. Investing in renewables, particularly solar power, is an alternative to being dependent on increasingly volatile oil prices. They said, “The energy sector may play a significant role here by utilizing the region’s great potential for generating and delivering clean energy.