LONDON – Oil and gas giant BP released its benchmark Statistical Review of World Energy on Thursday, describing 2020 as “a year like no other” due to the impact of the coronavirus pandemic on global energy.
Over the past seven decades, BP claimed to have witnessed some of the most dramatic episodes in the history of the global energy system, including the 1956 Suez Canal crisis, the 1973 oil embargo, the 1979 Iranian revolution and the 2011 Fukushima disaster.
“All moments of great turbulence in global energy,” said Spencer Dale, chief economist at BP, in the report. “But all pale compared to the events of last year.”
To date, more than 185 million Covid-19 cases have been reported worldwide with over 4 million deaths, according to Johns Hopkins University. The actual number of Covid-19 infections and deaths is believed to be far higher – and continues to rise.
The pandemic also resulted in massive economic losses, with global GDP estimated to have fallen by around 3.3% over the past year. This is the biggest peacetime recession since the Great Depression.
The Covid pandemic is having a dramatic impact on global energy. Here are some highlights from the report:
BP said the coronavirus crisis last year caused primary energy and CO2 emissions to fall at the rate they have since World War II. However, the relentless expansion of renewable energies went “relatively unscathed”, with solar energy recording the fastest increase of all time.
The oil and gas company said that global energy demand had fallen by 4.5% and global CO2 emissions from energy consumption had shrunk by 6.3%.
“These declines are enormous by historical standards – the largest declines in both energy demand and carbon emissions since World War II. In fact, the decrease of over 2 Gt CO2 means that last year carbon emissions were back to 2011 levels, ”said Dale.
“It is also noticeable that the carbon intensity of the energy mix – the average carbon emissions per unit of energy used – has decreased by 1.8%, also one of the largest decreases in post-war history,” he added.
For some, the decline in global CO2 emissions briefly raised hopes for so-called “peak carbon”, although the desire to limit global warming – and achieve a key goal of the groundbreaking Paris Agreement – is rapidly deteriorating.
It does so as politicians and business leaders publicly acknowledge the need to transition to a low-carbon society, with policymakers under increasing pressure to deliver on the promises made under the Paris Agreement ahead of this year’s COP26.
“There are worrying signs that last year’s COVID-induced decline in carbon emissions will be short-lived as the global economy recovers and lockdowns are lifted,” said Bernard Looney, CEO of BP, in the report .
“The challenge is to reduce emissions sustainably and in a year-on-year comparison without massively affecting our livelihoods and our everyday lives,” he added.
An overview of Gunvor Petroleum or Rozenburg Refinery in Rotterdam, the Netherlands. Europe’s largest port covers 105 square kilometers (41 square miles) and stretches for 40 kilometers (25 miles).
Dean Mouhtaropoulos | Getty Images News | Getty Images
Oil demand fell most in the US with a decline of 2.3 million barrels, followed by the EU and India with 1.5 million barrels and 480,000 barrels respectively.
BP said global oil production has shrunk by 6.6 million barrels, with two-thirds of that decrease being attributable to the oil producing group OPEC.
The price of international benchmark Brent crude averaged $ 41.84 in 2020, according to the energy giant, its lowest level since 2004. The oil contract was last traded at $ 73.70.
“Arguably the most important element of the energy system needed to address both aspects of the Paris Agreement – responding to the threat of climate change and supporting sustainable growth – is the need for rapid growth in renewable energy,” said Dale of BP in the report.
Renewable energies, including biofuels and excluding hydropower, rose 9.7% in 2020, BP said. This was slower than the 10-year average of 13.4% year-over-year, but the increase in terms of energy was similar to the years before the pandemic.
Solar power rose by record levels, but wind was found to be the largest contributor to renewable energy growth.
In terms of capacity, solar power grew 127 gigawatts in 2020 while wind power grew 111 gigawatts – nearly double the highest annual increase to date, BP said. “The main driver was China, which has accounted for about half of the global increase in wind and solar capacity,” said Dale.
Speaking of BP’s latest annual Statistical Review of World Energy, Dale said, “The significance of the past 70 years pales when we look at the challenges the energy system will face for the next 10, 20, 30 years as the world continues after that strives to achieve net zero. “