The oil and gas sector can "do much more" to address the climate crisis, by diversifying more into clean energy, which accounts for only 1% of today's investments, the International Energy Agency (IEA) warns.
"The sector can do much more to address the threat of climate change," IEA wrote in a report on this subject published earlier this week.
"Whatever path the world takes, climate impacts will become more visible and more serious in the coming years, which will increase the pressure put on all elements of the society to find solutions. These solutions are not found in the current paradigm oil and gas," the IEA says.
The agency, which advises developed countries on energy policy, made recommendations so that the sector’s activity becomes compatible with the Paris agreements on climate.
It believes that a “much more significant” change in oil companies' investments is necessary.
Oil companies have more or less made the diversification shift towards solar, land and sea wind energies, or biofuels.
However, these investments that are outside of their core businesses now account for only 1% of their total investments. Even for companies that are the most advanced in the transition, the figure reaches a measly 5%, IEA reports.
“At the moment, there are few signs of a major shift in businesses’ financial investment,” the report points out.
Another point made by the Paris-based agency: reducing emissions directly related to the sector’s operations from extraction to distribution of hydrocarbons "should be a top priority for all." They now account for 15% of greenhouse gas emissions that are energy-related.
In particular, they should now tackle the leaks of methane gas into the atmosphere, a gas that has a very high warming attribute.
The IEA notes that the solution is not only in the hands of the 'Super giants': the giant private groups such as BP, ExxonMobil and Total.
National companies account for more than half of the world’s production of hydrocarbons, and "many of them are not in a good place to adjust to changes in the global energy dynamics.”
The Brussels Times