At least 19 economies that depend on oil and gas exports are reportedly at risk of losing trillions of dollars by 2040 due to climate action initiatives, according to Bloomberg. Libya and Saudi Arabia could be the hardest hit despite demand for fossil fuel expected to grow during the green transition.
- The results are “a wake-up call” for the fossil fuel-dependent countries to diversify their economies and richer nations to help those with weak finances transition to clean energy.
- Azerbaijan, Angola, Congo, Libya, Nigeria, and Saudi Arabia are those in the most exposed categories, with some projected to lose about 40% of total government revenues.
- Iran, Mexico, and Russia, which have more diversified economies, stand to lose between 10% and 20% of total government revenues by 2040.
- Already, Saudi Arabia and some other Gulf oil and gas exporters are taking steps to reduce dependence on oil revenues and are cushioned by low extraction costs and large sovereign wealth funds.
- Andrew Grant, head of climate, energy, and industry at Carbon Tracker, has warned the assumption that demand for oil and gas must fall due to climate actions.
- Demand modeling shows a possible increase in oil and gas consumption for years despite the actions to move away from fossil fuel.
OPEC forecasts the global oil production to rise to $109 billion barrels in 2045, from 100 billion barrels in 2019.
