Report Summary: The Power Shift: The impact of the low-carbon transition on the oil and gas economy
The Power Shift: The impact of the low-carbon transition on the oil and gas economy
By Yana Popkostova
The global transition to low-carbon consumption needed to curtail climate change is not easily
accomplished, and will have major implications on the global economy. Completely overhauling energy consumption by minimizing the use of oil, gas, and coal runs the risk of warping the economy if it is not accompanied by an effort to reduce overall energy demand as well. Such a shift may change existing power dynamics in the fossil fuel industry and alter trade relations, which can lead to unwanted power struggles further down the line.
This paper explores the transformation that the global energy system is currently undertaking and how these changes will affect the global economy as well as the societal impacts for hydrocarbon producing countries. It examines the impact of decarbonisation on energy security, noting often overlooked consequences, and highlights the disparity between hypothetical decarbonisation policies and actual action taken by policymakers. It identifies options for hydrocarbon producers to adapt to future low-carbon policies, and analyzes the effects of geopolitical crises on decarbonization efforts. It also identifies ways for Europe to bolster its resistance to energy scarcity and likely impacts on the economy.
Finally, the paper examines the future of hydrocarbon based energy in a changing energy landscape, exposes the limitations of new energy technologies, and sets out recommendations for the EU to consider when adopting new energy policy.
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