Amid declining fossil fuel consumption worldwide during the Covid-19 pandemic, oil giant BP on Tuesday said it would reduce its oil and gas production by 40 percent by 2030. Climate campaigners said the announcement—on top of a $16.8 quarterly loss—should be a warning to other giants in the industry about the economic writing on the wall when it comes to the future of fossil fuels.
Environmental groups that have long targeted BP as one of the world's premier climate villains said the new commitment to reduce production at a much faster rate than any other comparable-sized company comes at a crucial time and should not be ignored.
"The good news is that BP will actually produce less oil and gas, and they're making that change this decade," John Sauven, executive director of Greenpeace UK, said in a statement. "That is vital. Up to this point, many companies, from fossil fuel majors to the aviation industry have focused on offsetting—which all too often is not even damage limitation."
Breaking: Big announcement from BP this morning.— Greenpeace UK (@GreenpeaceUK) August 4, 2020
Oil and gas production cut by 40%
Renewable energy production increased x20
Low carbon investment increased x10
There is much, much further to go, but has BP just woken up to the #ClimateEmergency? pic.twitter.com/LiqTuyJ9ZD
BP, the company responsible for the Deepwater Horizon disaster that spewed an estmated 4 million barrels of oil into the Gulf of Mexico in 2010—also said it will increase renewable energy production and lower carbon emissions over the same period, but the reductions, as Sauven and others point out, don't include all of BP's fossil fuel-related economic interests.
"BP must go further," Sauven said, also noting that BP competitor Shell has yet to make similar commitments. "[BP] needs to account for or ditch its share in Russian oil company, Rosneft. But this is a necessary and encouraging start."
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BP attempted to rebrand itself as an eco-friendly company in 2000, adopting a fresh logo and the tagline "Beyond Petroleum," but the 2010 spill, the largest in the history of marine oil drilling, put the company in the public eye for negligent practices.
Still, climate activists say this latest effort, even if motivated by monetary loss for BP rather than concern for the environment, is a win.
This feels like the most serious announcement from a =n oil major: after years of pressure from activists, BP to cut oil and gas production 40% by 2030. Far from perfect, but far from normalhttps://t.co/r4JSFqbqCM— Bill McKibben (@billmckibben) August 4, 2020
"Today's announcement is an important signal to the rest of the industry that the only credible way to cut pollution is to cut fossil fuel production," said Kelly Trout, senior research analyst at Oil Change International.
"Vague promises of ambition by 2050 are meaningless," added Trout, "without clear details on the actions oil majors will take to manage a rapid decline in extraction within this decade, the critical time frame for staying within 1.5 degrees of warming."