As the CERAWeek 2025 conference in Houston draws to a close, global leaders, including top executives and ministers, have debated the future of the oil and gas industry. Discussions centered around whether trade, tariffs, and competition will shift the focus of energy markets and policies, previously driven by security, affordability, and sustainability.
One of the key highlights of the conference was a heated exchange between Saudi Aramco CEO Amin Nasser and IEA Executive Director Fatih Birol, who hold vastly different views on the global oil industry’s future. Nasser once again expressed skepticism about the transition away from fossil fuels, criticizing predictions such as the IEA’s forecast of peak oil demand by the end of this decade. “I pay little attention to forecasts claiming next year will mark the peak,” Nasser remarked, implicitly challenging the IEA’s outlook.
In response, Birol emphasized that a peak in oil demand would not immediately lead to a drastic decline in fossil fuel consumption. He clarified that any peak in demand would likely be followed by a long plateau, with consumption stabilizing over time. Birol also stressed the importance of continued investment in existing oil and gas fields to counter natural declines in production. While some viewed this as an attempt to align with political figures advocating for increased drilling, the IEA has long supported ongoing investments in upstream oil and gas, even as demand for fossil fuels decreases.
The IEA’s position is that energy security will remain a challenge even as the world adjusts to shifting demand patterns. In its 2023 World Energy Outlook, the agency emphasized that the decline of existing oil and gas fields requires sustained investments to maintain energy security.
Amid these debates, some Republican lawmakers have criticized the IEA, accusing it of championing the energy transition agenda, and have suggested reassessing the agency’s funding.
Big Oil and the Transition to Cleaner Energy
As the global energy transition accelerates, many major oil companies are under pressure to reduce greenhouse gas emissions while continuing to meet high demand for energy. In response, several companies are finding ways to clean up their operations without abandoning their traditional business models.
Saudi Aramco, the world’s largest oil company, has announced plans to reach net-zero emissions by 2050, without cutting back on oil and gas production. During a two-day visit by Fortune in May, Aramco revealed several ongoing research projects aimed at addressing climate change while continuing to produce millions of barrels of oil each day. The company claims that its technological advancements could reduce carbon emissions per barrel by 15% by 2035, potentially eliminating 51.1 million tons of carbon annually.
“We don’t see any contradiction. Combating emissions from conventional energy sources is a very viable option,” said Ashraf Al-Ghazzawi, Aramco’s executive vice president for strategy and corporate development. Aramco’s approach focuses on optimizing existing production and improving efficiency to meet growing global energy demand, especially in developing nations.
Aramco has tripled its research-and-development (R&D) staff since 2010, and the company currently spends about $800 million annually on R&D, with 60% of that amount dedicated to sustainability projects. The company has also filed over 1,000 patents with the U.S. patent office.
One of Aramco’s key strategies is carbon capture technology. At its Hawiyah gas plant, the company captures carbon emissions during oil and gas production, transports it 50 miles, and injects it into an oil well to enhance crude recovery while storing the carbon. Aramco aims to reduce the cost of carbon capture by 50%, making it commercially viable. In December, the company entered into a partnership with Linde Plc and Schlumberger Limited to develop a large-scale carbon capture and storage (CCS) hub at Jubail, which is expected to begin operations by 2027.
Aramco is also investing in hydrogen production technologies. By 2030, the company aims to produce 11 million tonnes of blue ammonia from its Jafurah natural gas field. However, Aramco faces challenges in finding buyers for its blue hydrogen, which is expensive to produce. CEO Amin Nasser acknowledged that the high cost of blue hydrogen—about $250 per barrel equivalent—has made it difficult to secure off-take agreements, even with countries like Japan and Korea, which are working on hydrogen economies.
Despite these challenges, Aramco remains committed to its strategy of balancing emissions reduction with ongoing fossil fuel production. “We were never an either-or company. Aramco provides a great example where emissions can be managed effectively,” Ghazzawi said.
As Aramco continues to explore various R&D pathways, it remains focused on its goal of maintaining oil production while addressing environmental concerns. However, the company’stimeline for achieving these goals may take years, and with global energy needs evolving, time is of the essence.
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