![Covid-19 and climate crisis:
aspects of the Anthropocene
âș Johannes Vogel, director of Berlin Museum of
Natural History, 9 April: âOur arrogant relationship with
nature fuels, and even causes, many of humanityâs
greatest challenges. The threats we face are
interrelated: climate change, the loss of biodiversity
and the emergence of entirely new pathogens that
threaten us time and again.â
âș We need to think in terms of inter-related threats,
not about âwhen this [Covid-19 emergency] is overâ.
âșAnd we need to ask: who is âweâ? These threats are
generated not by undifferentiated humanity, but by a
society divided by class and neocolonial power relations
2](data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7)
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Covid 19 and oil extractivism
- 1. Scot-E3 webinar Covid-19 and oil extractivism Simon Pirani Author of Burning Up: A Global History of Fossil Fuel Consumption Senior Research Fellow, Oxford Institute for Energy Studies @SimonPirani1 â www.simonpirani.com 1
- 2. Covid-19 and climate crisis: aspects of the Anthropocene âș Johannes Vogel, director of Berlin Museum of Natural History, 9 April: âOur arrogant relationship with nature fuels, and even causes, many of humanityâs greatest challenges. The threats we face are interrelated: climate change, the loss of biodiversity and the emergence of entirely new pathogens that threaten us time and again.â âș We need to think in terms of inter-related threats, not about âwhen this [Covid-19 emergency] is overâ. âșAnd we need to ask: who is âweâ? These threats are generated not by undifferentiated humanity, but by a society divided by class and neocolonial power relations 2
- 3. Oil demand has crashed âșOil demand in 2019 was 100.9 million b/d âșDemand in April 2020, implied estimates: 72 million b/d (Intânl Energy Agency) 82 million b/d (US Energy Info Agency) 65 million b/d (Trafigura) âșEstimate of demand in 2020 as a whole: 91.6 million b/d (IEA) âșOutput cuts agreed by OPEC+, from May: 9.7 million b/d (IEA) 3 81 82 83 84 85 86 87 88 89 90 91 92 2005 2006 2007 2008 2009 2010 2011 2012 Global oil use, million b/d What happened in the last recession
- 4. Crude oil prices: the G20 / OPEC+ deal did not stop the fall, but China recovery may do 4 Oil The main driver is demand collapse, caused by coronavirus and the resulting economic crash 9 March. OPEC+ fails to reach agreement 12 April. Deal on 10% supply cut brokered by G20
- 5. 5 Demand for oil products has fallen through the floor Source: Financial Times, 2 April â At the end of March, global road transport was 50% down year on year (IEA) â Globally, car manufacture looks like it will be 20% lower this year than last
- 6. Aviation and just-in-time supply chains âșMore than 60% of commercial aircraft are grounded âșDelta Airlines, the worldâs largest airline, says it is losing $60 million a day âșBoeing cut production by one third in April âșJust-in-time supply chains, designed for low-cost efficiency but not sustainability, have been disrupted 6 âșDaily international flights down by 87% since January
- 7. Greenhouse gas emissions likely to fall by 2 billion tonnes (5%+) this year âș âEven this would not come close to bringing the 1.5C global temperature limit within reach. Global emissions would need to fall by some 7.6% every year this decade â nearly 2,800 million tonnes of CO2 in 2020 â in order to limit warming to less than 1.5C above pre-industrial temperaturesâ â Carbon Brief âșDemand for coal and gas (used to produce electricity and heat, and for industrial processes) has fallen less sharply than for oil (used for transport) âșSocietyâs need to transform industry, agriculture, urban built environments and transport systems will certainly survive Covid-19 7
- 8. Oil industry consolidation âșInternational oil companies are slashing investment, laying off workers ⊠and preparing to swallow smaller rivals âșUS shale producers, already heavily in debt, may not survive Covid-19. Whiting Petroleum is bankrupt âș âThey [Exxon and other IOCs] prefer all the independents to go bankrupt and pick up the scraps.â - Scott Sheffield, CEO of Pioneer Natural Resources, DeSmog Blog, 27 March âșâWe face the very real danger of an emboldened and resurgent oil industry, positioned ever more centrally within our political and economic systems. Such an eventuality would be a disastrous outcome to this current pandemicâ â Adam Hanieh (author, Lineages of Revolt: Issues of Contemporary Capitalism in the Middle East), 9 April 8
- 9. The impact on producer nations Fiscal breakeven price = the price the nationâs government says is needed to balance the budget. Graphic from PM News, Nigeria 9
- 10. The impact on producer nations âș Russia balances its budget at about $40/barrel, and has $170 billion in sovereign wealth fund âșSaudi Arabia, Qatar, Kuwait and UAE have substantial cash reserves ⊠but even they are borrowing, and cutting spending âșAlgeria announced 30% budget cuts; Iraq says half public-sector wages are in danger âșNigeria has made budget cuts, devalued the naira, considered junking petrol subsidies and sought $7 billion emergency loans âșPemex of Mexico, already heavily indebted before the Covid-19 emergency, is in financial trouble 10
- 11. The North Sea âș âOur current estimate is that up to 30,000 jobs could be lost over the next 12â18 monthsâ â Oil & Gas UK, 28 April âșBP has put Clair South project on hold. Final investment decisions on the Jackdaw project (Shell) and the Platypus project (Dana Petroleum) have been postponed. âșâWe need government supportâ â Ross Dornan of Oil & Gas UK. (Really? And did the royal family say, âwe need free moneyâ, too?) âșThe Sea Change report (published last year by NGOs) argued that any serious approach to tackling climate change involves ending subsidies to North Sea production and winding down production âșThat raises the question of âjust transitionâ away from oil & gas 11
- 12. Thoughts on the longer term âșWhen, and to what extent, oil demand will recover is unclear. Capitalismâs tendency to expand aggressively as it emerges from crises it has created is clearer âșSome mainstream commentators think the jolt to rich-world use of cars and airplanes is strong enough that oil demand will never return to the 2019 level âș This may be. But changes to economic structure on a much greater scale will still be needed to tackle global warming âșPeople in oil producing countries outside the rich world will be hard hit by the economic depression. The logic of âkeep it in the groundâ has never been stronger 12
- 13. Published August 2018 "Insightful, precise and well-written, Burning Up turns energy consumption on its head. Pirani fills a crucial gap ... Anybody fighting climate change should read this" - Mika Minio-Paluello, campaigner at Platform London and co-author of The Oil Road: Journeys from the Caspian Sea to the City of London (Verso, 2013) "This meticulous depiction of how fossil fuels are woven into our human systems - not only technological but also economic, social and political - is an invaluable aid to getting them back under control" - Walt Patterson, author of Electricity vs Fire (2015) "Explains the technological, social and economic processes that have prioritised a particular way of satisfying society's demand for energy services" - Michael Bradshaw, Professor of Global Energy, Warwick Business School, UK, author of Global Energy Dilemmas (2013) @SimonPirani1 â simonpirani@gmail.com 13