The Appalling State of Global Energy Consumption

BP CEO Bob Dudley

The sentiment surrounding the annual general meeting of British Petroleum (BP) shareholders last month was, to say the least, irritable. The audience interrogated the board down two thematic narratives: one, focused on by long-term shareholders, concerned the exploitation of BP profit by global regulators, namely in relation to the Gulf of Mexico spill, and the general decline in readily available surplus (usually in relation to their own dividends, or lack of them); the second, focused on by proxies including an ex-sabbatical officer of School of Oriental and African Studies Students’ Union, concerned BP’s ethical conduct in the past and its plans for the future, including the Canadian tar-sands project. One attendee was removed for her continuous highlighting of this latter issue, which, while indeed breaking the order and structure of the meeting, was met with loud boos and hisses from a large number of shareholders, on the basis of subject. It seems, however, that it is not necessarily BP’s fault that such matters are brought up, or beaten down; it is the global demand for energy, therefore non-renewable energy, that encourages BP to seek resources in ‘dirty’ sectors such as tar-sands, to cause accidents such as the 2010 Gulf spill, and for shareholders to hold profit and reward above the health of the environment and realist debate. This article studies statistics on global production and consumption of oil, and the pitiful share of global consumption that renewable energy accounts for. Incidentally, such statistics are provided by BP itself; it is interesting to note that the syntax in the reports is not only neutral, but reasonably positive towards the trends discussed below.

The Global Production and Consumption of Non-Renewal Energy

These being BP’s 2011 figures, oil takes precedence, thought it only accounts for 33.1% of global energy consumption; that’s 88 million barrels per day (b/d). This, however, was below the average growth in primary energy consumption, which lay at 2.5%. China recorded the largest growth in oil consumption that year, with an increase of 5.5%. Virtually every other oil-related statistic increased too: global production was up 1.3%, caused almost entirely by members of the Organisation of Petroleum Exporting Countries (OPEC), despite the loss of Libyan supplies, which were replaced by increased quotas in OPEC economies and by strategic supplies released by the International Energy Agency. Global oil trade also increased by 2%, as more and more crude oil was moved around the world.

Elsewhere in non-renewable energy, natural gas consumption increased globally by 2.2%, headed mainly by China (+21.5%), Saudi Arabia (+13.2%) and Japan (+11.6%). Coal saw a similar story, as consumption rose by 5.4% globally. The figures conclude that 97.9% of global energy consumption in 2011 was accounted for by non-renewable sources. This, in itself, is a horrifically high figure. Also, as mentioned, the sentiment in reports such as the BP review is not pragmatic or concerned, but complimentary, in the same way that the Chancellor of the Exchequer might be warm in surveying results of national economic growth.

The Poor Proportion of Renewable Energy in Global Consumption 

Expanding on the 2.1% stat, the share of renewables in global energy consumption, renewable energy is not taking as strong a hold of the market as some might have hoped. The cost of researching, developing and producing renewable energy, in the framework of a global economy that demands supplies here and now regardless of the social, environmental and – to an extent – financial costs, are simply too high. 2011 saw the weakest growth in production since 2000, although the share of renewable energy in global consumption has tripled. Regardless, the source still occupies a pitiful sector of global demand. Economists are unsure whether the recent rise in fuel prices will push corporations and economies to work harder on developing economically viable forms of renewable energy. In the UK, despite a fall in demand for petrol and diesel in March due (apparently) to the cold weather, vehicle fuel prices have still risen on average since the beginning of the year. Perhaps figures like this, only set to become more and more extreme, will have an impact on the Research and Development sectors of companies with slipping profits due to such price rises, and subsequent falls in demand.

Conclusion

An upcoming piece will discuss which trade routes are the most lucrative, and should therefore be targeted as possibilities for the promotion of green energy. For now, the attitude of the BP loyalists needs to be adjusted. There is no place for disorder and abuse at important meetings such as last month’s AGM but the response from shareholders was shameful. They may be peeved that authorities have come down harshly on the company, and that the board seems to be doing little to fight for the profits that are being given up; however, it is very difficult to have sympathy with such people due to their unwillingness to tackle moral problems still reverberating around the corporation. The tar-sands project, the Gulf spill, even the pay of their cleaners in the St. James’s Square headquarters will all, by proxies most certainly, be brought up again next year. How the atmosphere will change is to be scrutinised.

Bibliography

British Petroleum plc. ‘Statistical Review of World Energy’. June 2012

Greenpeace, ‘BP and tar-sands’. Available at http://www.greenpeace.org.uk. Retrieved 26/04/2013

City AM, Tuesday 30th April 2013

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2 thoughts on “The Appalling State of Global Energy Consumption

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