HOUSTON - On Monday, top global energy executives and officials debated how to quickly switch the world's economy from fossil fuels to renewables in order to avert a climate catastrophe without sabotaging crucial oil and gas supplies.
Two senior executives used the same famous phrase from an astronaut in the damaged Apollo 13 spacecraft in 1970 to inform some of the most influential people in the global energy sector that "Houston, we have a problem" in the heart of the American oil industry.
Sultan al-Jaber, CEO of Abu Dhabi National Oil Company and president-elect of the COP28 climate summit, used the phrase to implore conference attendees to act more quickly to slow down global warming, which the majority of the energy companies in attendance had accelerated.
The same phrase was used earlier in a panel discussion on the difficulty of striking a balance between the need for energy security and affordability by Tengku Muhammad Taufik, CEO of Petronas.
Jaber's appeal to energy companies to aid in the transition was a novel development at a gathering that fossil fuel producers had previously viewed as a threat to their livelihood.
An energy shortage caused by Russia's invasion of Ukraine disrupted the supply of fossil fuels to industry and consumers. The highest global inflation in decades was fueled in 2022 by rising fuel prices.
The Russian supply interruptions were seen by many in the sector as a warning against adopting policies that would cut off or raise the cost of fossil fuels. One of the greatest challenges of all time, according to Chevron Chief Executive Mike Wirth, is managing the energy transition to a low-carbon economy while maintaining secure and affordable supplies.
According to Wirth, a disorganized energy transition could be "painful and chaotic."
We must exercise extreme caution when turning off System A too soon and relying on a system that is untested and has not yet been established, he warned.
According to German state secretary in the economy ministry, Patrick Graichen, interruptions in the gas supply to Europe have sped up the transition and hurt Germany's economy, the continent's largest.
"There are some fundamental questions that need to be answered if you are used to cheap Russian gas and you wake up in this world," he said. He argued that Germany needed to accelerate electrification and create a sustainable hydrogen supply.
It's not about securing the old world, but rather about accelerating the transition to the new world, if we can speed that up and make it fit together.
Depending on the resources available, each nation will transition to energy in a different way, according to leading American oil company Exxon. According to Liam Mallon, the president of Exxon's upstream oil and gas division, the gas would serve as a transition fuel in some nations.
Mallon urged decision-makers, international and domestic oil companies, and academics to collaborate on a transition plan.
"We can't handle this by ourselves," he said. To advance through the energy transition, policymakers, regulators, innovators, NOCs, and IOCs must all collaborate to create the right incentives.
According to U.S. energy envoy Amos Hochstein, the coordination of the timeline for change was the most challenging aspect of the energy transition.
As Hochstein noted, "I think you can't just do it without planning it out if you're going to go through the greatest transformation that the world has seen in over 100 years, of unplugging from one energy system and creating a whole other one."