Shivani Singh and Aaron Sheldrick

BEIJING (Reuters – Global fossil fuel firms are back to business in the short-term following the COP26 Climate Summit. The agreement stated that the world should “phase down” and not “phaseout” coal use.

Even though the UN agreement reached in Glasgow was the first to address fossil fuels, the coal-reliant nations raised last-minute objections about the language change to “phase out” coal.

However, change is not something that can be achieved overnight.

Abu Dhabi’s state oil giant Abu Dhabi National Oil Co (ADNOC) Chief Executive Sultan al-Jaber told a conference on Monday that the world could not “simply unplug” https://www.reuters.com/business/energy/uae-opening-oil-gas-summit-says-no-unplugging-hydrocarbons-2021-11-15 from hydrocarbons.

If we wish to make a successful transition to the new energy system, it is not possible to unplug our energy systems of today. He said that we cannot simply flip a switch.

To meet the expected demand, the oil-and-gas industry must invest more than $600billion per annum until 2030.

China, world’s largest consumer and producer of fossil fuels, posted Monday its highest monthly output of coal since March 2015. The increase in production was achieved by mines to provide winter heating for the country and address a power crisis.

China saw a drop in coal stockpiles after the Glasgow Climate Deal, however tight supply conditions provided a ceiling on prices.

“No COP will impose real restrictions on fossil fuels, the fossil countries always block such ideas,” said Tomas Kåberger, affiliate professor at Chalmers University of Technology, Sweden.

“But again, the COP brought together progressive countries to create renewable energy businesses that outcompete fossil fuels. He said that this progress continues with increased industrial engagement.

LNG DEALS

In other developments on Monday that underlined the continued importance of fossil fuels, Japan’s Jera, the world’s biggest buyer of liquefied said it would pay $2.5 billion to buy a stake in Freeport LNG https://www.reuters.com/world/asia-pacific/japans-jera-buy-257-stake-freeport-lng-25-bln-2021-11-15 to secure long-term supplies for gas to power its electricity generation.

Natural gas, however, is cleaner than oil or coal and many countries consider it a crucial part of their energy mix in order to transition toward greater renewables.

Woodside, Australia’s largest independent oil and gas company (OTC:) Petroleum sold Monday a stake its Pluto LNG expansion acquisition to a private equity firm GIP.

Li Shuo (a senior climate advisor with Greenpeace based in Beijing) commented on the prospects for coal following the Glasgow conference.

“Quitting coal is like quitting cigarettes. “It won’t always be pain-free but it must be done for the benefit of others as well as for yourself,” he said.

According to developing countries, rich nations with a history of causing global warming must fund their efforts to shift away from fossil fuels as well as adapt to the increasing severity of climate change impacts. The amount of fossil fuels used in developed nations is already at an all-time low.

Li of Greenpeace said, “Countries must increase their climate targets to deliver them in 2022… Industrialised nations need to lead this direction.”