The shocking announcement by the oil giant BP that
the oil would never recover to the level that the markets were aspiring for,
was the last thing that the producers wanted to hear in a turbulent time.
The producers, mainly the OPEC, did not try to
dampen the pessimism. On the contrary they added fuel to the fire by saying
that the global demand will be down by 400,000 bpd this year.
The OPEC and BP saw eye to eye on the issue and the
influential global Green lobby, understandably, was ecstatic.
It is highly debatable why BP chose to embrace the
gloomy outlook for the future of fossil fuels, when the evidence clearly shows
signs to the contrary – fossil fuels are here to stay for decades to come.
In fairness to BP – and all those in similar
positions – we have to admit the oil giant knows the influence that environment
activists wield over many global bodies.
With the minority that defends the industry is on permanent
and irreversible decline, these companies were left with no choice, but adapt
to reality, before being completely voiceless or even irrelevant.
It is highly likely that other oil giants will be tempted
to follow suit in the coming months, rather than being at the centre of PR
backlash.
In those circumstances, the OPEC will be forced to
look beyond production cuts to face the multiple challenges; neither short-cuts
nor soundbites will do the trick to reverse unprecedented threats on many
fronts to the industry.
