Illustration: Aïda Amer/Axios

A Texas carbon capture project hailed as a key solution to climate change has been "mothballed" over low oil prices, E&E News reported on Tuesday evening. 

Our thought bubble: The news is unsurprising but nonetheless emblematic of the complex relationship between climate policies and oil prices, which collapsed along with oil demand in the wake of the pandemic.

How it works: The Petra Nova project, which I visited in 2018 for this column, captured a small share of the carbon dioxide emissions from an adjoining coal plant, which were then used to extract oil out of the ground through a process called enhanced oil recovery.

  • That process is expensive, so oil prices need to be higher than where they are now (around $40 a barrel) to sustain it financially.

Between the lines: Two schools of thought persist about the relationship between climate policies and oil prices. 

  • Oil (and natural gas) prices need to be high to force behavior change on behalf of businesses and consumers.
  • Oil and gas prices should be low to allow the political room for all sides to compromise on big policy. 

But, but, but: The problems with those two schools of thought, in order: 

  • High oil prices often compels politicians into imminent crisis mode (price manipulation! Investigate OPEC!), so they're not thinking about longer-term climate policies.
  • If prices are too low, it makes it harder for more expensive technology — whether that's carbon capture or electric cars — to compete with fossil fuels. We're seeing this play out now with Petra Nova.

What we're watching: A spokesman for the company behind the project, NRG Energy, says it will come back online when "economics improve" (code for when oil prices go back up, which is not a given any time soon).

Go deeper: The oily path to combating climate change

Go deeper

Ben Geman, author of Generate
Oct 23, 2020 - Energy & Environment

Biden looks to stem oil "transition" furor amid GOP attacks

Former Vice President Joe Biden. ANGELA WEISS / Getty Images

Joe Biden's campaign is looking to blunt attacks in response to his comments in Thursday night's debate about a "transition from the oil industry," as Republicans look to make the remarks a liability in the closing days of the race.

Driving the news: Biden campaign spokesperson Bill Russo, in comments circulated to reporters Friday afternoon, said the former VP "would not get rid of fossil fuels," but wants to end subsidies.

Ben Geman, author of Generate
Oct 23, 2020 - Energy & Environment

Japan expected to aim to go carbon-neutral by 2050

Data: IEA; Chart: Andrew Witherspoon/Axios

Japan's newly elected Prime Minister Yoshihide Suga is slated to announce a target next week of making the nation carbon-neutral by 2050, per reports in Nikkei, Reuters and elsewhere.

Why it matters: Japan is one of the world's largest carbon emitters, per International Energy Agency data, though far smaller than China, the U.S. and India.

Opposition leader Leopoldo López flees Venezuela

Venezuelan opposition politician Leopoldo López outside the Spanish embassy in Caracas, in 2019. Photo: Juan Barreto/AFP via Getty Images

Leopoldo López, a former political prisoner and prominent Venezuelan opposition leader, has left the country, his Popular Will party confirmed in a statement Saturday.

Why it matters: He's been an influential force in the push to oust President Nicolás Maduro's regime and a mentor to opposition leader Juan Guaidó. He'd been in the Spanish ambassador's Caracas residence since escaping house arrest in April 2019 following a failed military uprising.