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RIYADH: Oil giant Saudi Aramco’s chief on Tuesday blasted “unrealistic” energy transition plans, calling for a “new global energy consensus”, including ramped-up investments in fossil fuels to address painful shortages.

Speaking at a conference in Switzerland, Amin Nasser, head of the world’s biggest crude producer, lamented a “deep misunderstanding” of what caused the current energy crunch and said a “fear factor” was holding back “critical” long-term oil and gas projects.

“When you shame oil and gas investors, dismantle oil- and coal-fired power plants, fail to diversify energy supplies (especially gas), oppose LNG receiving terminals, and reject nuclear power, your transition plan had better be right,” he said.

“Instead, as this crisis has shown, the plan was just a chain of sandcastles that waves of reality have washed away.

“And billions around the world now face the energy access and cost of living consequences that are likely to be severe and prolonged.”

The primarily state-owned Saudi Aramco last month unveiled record profits of $48.4 billion in the second quarter of 2022, after Russia’s invasion of Ukraine and a post-pandemic surge in demand sent crude prices soaring.

Yet even as it benefits from the current energy crisis, Riyadh has long complained that focusing on climate change at the expense of energy security would further fuel inflation and other economic woes.

With consumers and businesses in Europe facing soaring bills as winter approaches, the causes of the crisis run deeper than the Ukraine war, Nasser said Tuesday, asserting that the warning signs were “flashing red for almost a decade”.

They include declining oil and gas investments dating back to 2014 and flawed models for how quickly the world could transition to renewable sources, he said.

‘Flawed assumptions’

The “energy transition plan has been undermined by unrealistic scenarios and flawed assumptions because they have been mistakenly perceived as facts”, Nasser said.

His proposed “new global energy consensus” would involve recognising long-term needs for oil and gas, enhancing energy efficiency and embracing “new, lower-carbon energy” to complement conventional sources.

Nasser nonetheless said there should be no change in global climate goals.

Riyadh has come under intense outside pressure in recent months to ramp up oil production, including during a visit by US President Joe Biden in July.

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