This article was written by Sibi Arasu and was published in the Globe & Mail on November 24, 2023.

The oil and gas sector, one of the major emitters of planet-warming gases, will need a rapid and substantial overhaul for the world to avoid even worse extreme weather events fuelled by human-caused climate change, according to a report released Thursday.

The current investment of US$800-billion a year in the oil and gas sector will need to be cut in half and greenhouse emissions, which result from the burning of fossil fuels such as oil, will need to fall by 60 per cent to give the world a fighting chance to meet its climate goals, the International Energy Agency said. Greenhouse gases go up into the atmosphere and heat the planet, leading to several impacts, including extreme weather events.

The IEA’s report comes just ahead of the United Nations climate conference, or COP28, which begins next week. Oil and gas companies, as well as other people and organizations connected to fossil fuels, often attend the meeting, drawing criticism from environmentalists and climate experts. But others say the sector needs to be at the table to discuss how to transition to cleaner energy.

“The oil and gas industry is facing a moment of truth at COP28 in Dubai,” said Fatih Birol, executive director of the IEA in a press statement on the report’s release. “Oil and gas producers need to make profound decisions about their future place in the global energy sector.”

Last year’s climate conference in Egypt saw 400 people connected with fossil-fuel industries at the event, according to an analysis by Associated Press. The coming meeting has also come under fire for appointing the chief of the Abu Dhabi National Oil Company as the talks’ president.

The energy sector is responsible for more than two-thirds of all human activity-related greenhouse-gas emissions, and oil and gas is responsible for about half of those, according to the IEA. Oil and gas companies are also responsible for more than 60 per cent of methane emissions. Oil and gas companies can find alternative revenue from the clean energy economy, including hydrogen and hydrogen-based fuels and carbon-capture technologies, the report said.

The report looked at climate promises made by countries as well as a scenario where the world had reached net-zero emissions by 2050. It found that if countries deliver on all climate pledges, demand for oil and gas will be 45 per cent lower than today’s level by 2050. If the world reaches net zero by then, demand would be down 75 per cent, it said.