Upstream oil industry’s perspectives of energy transition

Abstract

Subsequently to the spread of Covid-19 pandemic, the upstream oil and gas companies are in transition to sustainable investment by adopting Carbon Neutral Strategies. US major oil companies, which had more short-cycle resources than their European counterparts, had been less motivated to invest into renewable energies; in the annual general meetings held in May 2021, however, US majors had to choose more proactive stances to what climate inspired investors proposed, including for example, Exxon’s selection of three external directors of activists’nomination to its board. European majors, who had been ahead of the energy transition curve by taking pragmatic approach of simultaneously investing into natural gas liquefaction and renewable energies, on the other hand, are trying to adjust their strategies to the changing pace of the energy transition, accelerated by the Covid-19 pandemic. Independent oil companies and national oil companies have their own challenges to manage in their respective countries and societies. Every oil and gas company is trying to renew its license to operate while energy transition is casting questions of achieving sustainability and responsibility of investments simultaneously. The challenge responsible upstream oil and gas companies are facing is to achieve the dual targets of balancing carbon neutrality and sustainable investments.