Rise in oil & gas production, inadequate climate finance: How the Global North is derailing climate goals

At the same time, the Global North has paid just $280 billion to the rest of the world as climate finance since 2015, which falls far short of what is needed — $1 trillion to $5 trillion annually, the report, ‘Planet Wreckers: Global North Countries Fueling the Fire Since the Paris Agreement’, said.

Here is a look at how the Global North has failed to fulfil its commitments towards climate action, and what the repercussions may be.

Meet the ‘planet wreckers’

The latest analysis, carried out by the advocacy organisation Oil Change International, has revealed that Australia, Canada, Norway, and the US have collectively increased their oil and gas production by 14 million barrels of oil equivalent per day (boe/d) between 2015 and 2024. In the same period, extraction in the rest of the world’s production fell by 2% cumulatively.

The US alone accounts for more than 90% of the net global increase in extraction through 2024, driving up its production by nearly 11 million boe/d — more than five times as much as any other country, the report said.

Meanwhile, Australia leads all top 15 producers in terms of the rate of increase in production since the adoption of the Paris Agreement. The country’s oil and gas output has increased by 77% since 2015.

Source: ‘Planet Wreckers: Global North Countries Fueling the Fire Since the Paris Agreement’ report

This has happened even though countries at COP28 in Dubai had agreed to transition away from the fossil fuel era by the end of 2030 to keep the global temperature within the 1.5 degree Celsius limit.

The report also highlighted the “double standards” of the Global North, which has repeatedly criticised petrostates such as Saudi Arabia, the United Arab Emirates, and Venezuela for not reducing their production of oil and gas. The analysis has found that these petrostates either kept their production levels steady or even reduced them in recent years.

Romain Ioualalen, global policy lead at Oil Change International, in a statement, said, “The fact that a handful of rich Global North countries, led by the United States, have massively driven up their oil and gas production while people around the world suffer the consequences is a blatant mockery of justice and equity. These countries have a moral and legal obligation to move first to phase out fossil fuels, and deliver the trillions needed in climate finance on fair terms to the Global South. Anything less is a betrayal of science and abdication of responsibility.”

Climate finance defaulters

Under the Paris Agreement, the Global North has a legal obligation to pay its fair share in climate finance to the Global South. The amount is supposed to help a just and equitable transition away from fossil fuels, including programmes to support affected workers and communities.

However, in the years following the Paris Agreement, the Global North has failed to fulfil its promise. Instead, it has “pursued policy agendas that have further shrunk public budgets and concentrated wealth in the hands of fossil fuel companies and the super-rich,” the report has said.

For instance, Global North countries gave $465 billion in cumulative subsidies for fossil fuel production and distribution infrastructure, such as pipelines, since 2015. This amount could have been paid for climate action at home and abroad.

The analysis has also revealed that the profits of oil and gas companies based in the Global North were close to 5 times the amount of climate finance paid by the Global North to the rest of the world since 2015.

Source: OCI analysis of Bloomberg Terminal data (profits) and Oxfam analysis (climate finance)

“Six oil majors alone, ExxonMobil, Chevron, Shell, TotalEnergies, BP, and Eni, made twice as much in profits (over $580 billion) as all Global North countries paid in climate finance,” the report said.

The repercussions

Due to the actions of countries in the Global North, especially Australia, Canada, Norway, and the US, the world’s remaining carbon budget has become quite small. Scientists have warned that the budget to meet the target of 1.5 degrees Celsius has just two years left at the current rate of emissions.

The breach of this threshold would lead to an increase in frequency, intensity and/or amount of heavy precipitation in many regions, and an increase in intensity or frequency of droughts in some regions, according to the Intergovernmental Panel on Climate Change (IPCC).

Higher global temperatures would make oceans warmer, resulting in a higher number of strong hurricanes, with the possibility that they would quickly gain strength as they approach coastlines. Wildfires will also become more intense and last for a longer period. Sea ice melt will rapidly increase, which will contribute to sea level rise.

Most of these consequences have already started to emerge in recent years. Once the limit is breached, they are only going to get worse.

The low amount paid by the Global North in climate finance also risks the breach of the 1.5 degree Celsius limit. The money is crucial as it would support the Global South in transition to a low-carbon economy in a just and fair manner. Also, without adequate finances, the Global South, which is more vulnerable to the adverse effects of climate change, will not be able to cover the costs of loss and damage from extreme weather events.