BP (London Stock Exchange: BP.-GB) CEO Bob Dudley had choice words for public policymakers in response to what he viewed as an unrealistic over-focus on pushing renewables as a panacea for the world's energy problems. "We're in the oil and gas industry, so we're not allowed to have a point of view. The politically correct thing is for us to say this. But the reality is our policymakers or politicians either need to get more educated or be more honest, one or the other," Dudley said at the Abu Dhabi International Petroleum Exhibition Conference (ADIPEC). The line came during a CNBC-moderated panel called "Global Business Leaders - Driving growth" which also featured the CEOs of other oil and gas multinationals. Executives discussed the challenges of a changing energy landscape, pressures to curb carbon emissions and meeting the world's energy demands. A common theme was frustration with the demands of developed world governments to meet certain climate change targets, which the oil CEOs viewed as often incompatible with the developing world's energy needs. "There will be no energy growth in Europe, no growth in energy in North America, but there will be 2 billion more people on the planet and they won't be coming from those places," Dudley stressed. "Something like 1.4 billion people without access to electricity, and 1 billion or more don't even have access to cooking fuels. And our policymakers, too often, who are focused on waiting for the next election in 18 months, are trying to impose things that actually (according to) the law of big numbers will not work." Indeed, the OPEC outlook to 2040 sees the energy sector increasingly dependent on developing nations, particularly China and India, based on expanding population estimates.
"There is still a heavy dependence on oil and gas, and that's why we think oil and gas will still remain our core business, and not forgetting these new energies of course," said Tan Sri Wan Zulkiflee Wan Ariffin, CEO of Malaysian multinational Petronas at the same panel, describing a 20-year forecast in which oil and gas will still constitute 45 to 53 percent of the energy mix. OPEC expects oil and gas to continue supplying more than half of global energy needs by 2040, according to its 2017 World Oil Outlook report. The International Energy Agency has similarly reported that oil consumption and demand is projected to remain strong into the 2040s, despite a diversifying energy mix . Total CEO Patrick Pouyanne echoed the BP executive's sentiments. "I think there is something wrong in all this narrative today, because we are dominated by a sort of 'sanctified agreement'," he said, referencing the Paris Climate Accord's pledge to keep a global temperature rise this century below 2 percent.
"(In) developed countries ... we are over-impacted by the vision in our countries," Pouyanne continued. "But when you go to emerging countries, the debate is not fair. These countries are absolutely striving for energy because it's fundamental for economic and social development. And we are wrong in our Western world to believe that we are right on everything, and in fact on energy they are much more realistic and pragmatic that we are." "We have to be pragmatic and not believe that we have to give lessons to everybody. Because we are in the energy world, we must also help these politicians to face the reality, and not accept just to be accused because we do oil and gas. No, I'm very proud to be in the oil and gas industry," the Total CEO said. "We are listening because we also invest in new energies, and because by doing that we can face the economic reality."
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