Hydrocarbon hell
Scottish wind turbine operators got paid to curtail 37% of their output in the first half of the year. BP is reopening an oil field in the North Sea because extraction has become economically viable again, thanks to technological advancements. Norway is set to hold its first oil and gas tender since 2021. Germany got zero bids in its latest offshore wind tender, which did not offer subsidies. And China’s CATL suspended operations at one of the largest lithium mines in the world. Welcome to hydrocarbon hell, green beans.
For years, one of the chief arguments of the climate crusaders has been that quitting hydrocarbons will make countries more resilient to the global price swings of these commodities, often driven by everything else except the physical market. It is a sound argument. But there’s a detail. Those pushing the argument forgot to mention that all alternatives to oil and gas are dependent on them. That cat started peeking out of the bag a while ago and now it’s halfway out, with the fact of this dependence becoming increasingly harder to hide.
“Expectations for a rapid energy transition have moderated in recent years, as elevated inflation and interest rates raised costs and slowed development of renewables,” the FT stated with its usual authoritativeness today, adding that “Geopolitical instability has led governments to prioritise energy security over decarbonisation.”
This is a not very subtle admission that energy security and decarbonisation are kind of, sort of mutually exclusive despite the above argument and the one about “homegrown energy” that is also sound at first glance but not at second. Because “homegrown” is not exactly “homegrown”. It is most often China-grown. And China is about to make it all more expensive for everyone. Especially if India yields to the U.S. and stops buying Russian oil. Because in every transition nook and cranny one looks, one sees oil. Or gas. Or coal. Or all three.
