KSA to diversify oil economy to slow climate change

Updated 11 November 2015
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KSA to diversify oil economy to slow climate change

OSLO: Saudi Arabia, the world's largest crude oil exporter, plans to diversify its economy to help combat climate change in a move that could reduce expected carbon emissions by up to 130 million tonnes a year by 2030, the government said on Tuesday.
Saudi Arabia is the last of the Group of 20 major economies to submit a plan to the United Nations before a summit in Paris from Nov. 30-Dec. 11 about ways to slow global warming.
It said it was aiming "to achieve mitigation co-benefits ambitions of up to 130 million tons of carbon dioxide equivalent avoided by 2030 annually through contributions to economic diversification and adaptation."
The Kingdom did not give details of its emissions.
The mere submission of a plan by Saudi Arabia, which says its economy is threatened by a global shift from fossil fuels to renewable energies, is a positive sign for Paris.
"Thanks Saudi Arabia," Christiana Figueres, head of the UN Climate Change Secretariat, wrote in a Tweet, saying it was the 158th such national plan meant to combat heat waves, floods, droughts, downpours and rising sea levels.
Saudi Arabia said its plan was based on a main scenario in which it would diversify the economy with a "robust contribution" from export earnings from oil.
Earnings would be channeled into lower emission sectors "such as financial services, medical services, tourism, education, renewable energy and energy efficiency technology to enhance growth," it said.
An alternative scenario, not planned for now, would involve using more oil at home to fuel carbon-intensive industries such as petrochemicals, cement, mining and metal production, it said, thereby increasing domestic rather than overseas emissions.
It said it aims to use energy more efficiently and invest in solar, wind and geothermal power.
Saudi Arabia said in April it aimed to save the equivalent of 1.5 million barrels of oil a day through efficiency measures, limiting domestic consumption to sell more oil abroad.
Saudi Arabia's climate plan says it aims to build a plant capturing and using 1,500 tons of carbon dioxide a day for use in other petrochemical plants. It would operate a pilot plant at the Othmaniya oil reservoir.
The Kingdom has previously launched a pilot project to use solar energy to desalinate energy intensive seawater.
The government would also encourage investments in natural gas. It would seek to adapt to climate change, with measures ranging from reducing desertification to improving public transport.


OPEC oil ministers gather to discuss production increase

Updated 19 June 2018
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OPEC oil ministers gather to discuss production increase

  • Analysts expect the group to discuss an increase in production of about 1 million barrels a day
  • The officials were arriving in Vienna ahead of the official meeting Friday

VIENNA: The oil ministers of the OPEC cartel were gathering Tuesday to discuss this week whether to increase production of crude and help limit a rise in global energy prices.
The officials were arriving in Vienna ahead of the official meeting Friday, when they will also confer with Russia, a non-OPEC country that since late 2016 has cooperated with the cartel to limit production.
Analysts expect the group to discuss an increase in production of about 1 million barrels a day, ending the output cut agreed on in 2016.
The cut has since then pushed up the price of crude oil by about 50 percent. The US benchmark in May hit its highest level in three and half years, at $72.35 a barrel.
Upon arriving, the energy minister of the United Arab Emirates, Suhail Al Mazrouei, said: “It’s going to be hopefully a good meeting. We look forward to having this gathering with OPEC and non-OPEC.”
The 14 countries in the Organization of the Petroleum Exporting Countries make more money with higher prices, but are mindful of the fact that more expensive crude can encourage a shift to renewable resources and hurt demand.
“Consumers as well as businesses will be hoping that this week’s OPEC meeting succeeds in keeping a lid on prices, and in so doing calling a halt to a period which has seen a steady rise in fuel costs,” said Michael Hewson, chief market analyst at CMC Markets UK
The rise in the cost of oil has been a key factor in driving up consumer price inflation in major economies like the US and Europe in recent months.
Already US President Donald Trump has called on OPEC to cut production, tweeting in April and again this month that “OPEC is at it again” by allowing oil prices to rise.
Within OPEC, an increase in output will not affect all countries equally. While Saudi Arabia, the cartel’s biggest producer, is seen to be open to a rise in production, other countries cannot afford to do so. Those include Iran and Venezuela, whose industries are stymied either by international sanctions or domestic turmoil. Iran is a fierce regional rival to Saudi Arabia, meaning the OPEC deal could also influence the geopolitics in the Middle East.