Governments need to be the architects for climate change, so businesses in the oil and gas industry can be the builders to tackle the problem.
That was the view of BP chief Bob Dudley, on how the sector should respond to climate change during a speech at the International Petroleum (IP) Week conference today.
He believes the industry is concerned about climate change and is “increasingly” working on the issue.
Mr Dudley said: “There’s more we can do with rational and consistent policies… Governments have to lead the transition to a low carbon future.”
BP is part of the Oil and Gas Climate Initiative (OGCI), which states natural gas is key to the transition to a low carbon energy system.
Mr Dudley announced the firm aims to account for 60% of this resource by the end of the decade.
He also said minimising gas flaring is among the challenges the initiative has to fight climate change, as well as achieving greater efficiency in energy consumption.
Renewables are also part of the OGCI plans, BP’s CEO believes renewables could grow by 7% per year by 2035 but from a very low base.
That’s why he said he supports a carbon pricing mechanism, to raise costs of high carbon energies and make low carbon sources competitive.
He went on: “The cost of renewable energy has fallen in recent years though not as fast as the fall in the price of oil.”
Commenting on oil prices, Mr Dudley said supply demand fundamentals may be balanced in the second half of 2016 as Rosneft’s CEO Igor Sechin predicted.
He added: “We are very bearish for this half of the year… I don’t think we’ll see a $100 (barrel) for a long time.”