Oct 12, 2021 - Energy & Environment

Report: Oil execs split on decarbonization plans

Illustration of a fissure in the ground opening up towards barrels of oil.
Illustration: Aïda Amer/Axios

A lot of discussion about oil companies' climate efforts compares U.S. and European majors, but a new report shows there's no strategic consensus in the wider industry.

Driving the news: Deloitte's analysis says separate approaches have emerged as companies prepare for long-term declines in demand in a world that will still likely use huge amounts of oil for decades.

The big picture: The report, based on a survey of 100 C-suite execs across multiple types of companies, lays out four buckets that each have their own opportunities and risks:

  • 30% are "hydrocarbon stalwarts" focused on oil market share and low costs in regions with the least regulatory risk.
  • 47% plan to be "low-carbon producers" that see a major market for oil-and-gas produced with lower carbon intensity.
  • 5% are "net-zero pioneers" focused on dumping oil assets and commercializing and scaling clean energy.
  • 18% are "green followers" focused on monetizing fossil assets and waiting until newer tech is fully commercial before entering those markets.

The bottom line: "By associating themselves with an archetype that closely matches their strategy, O&G companies can identify ways to drive value from the transition — and there's indeed value up to or near trillion dollars for each to be unlocked."

Read the survey

Go deeper