This month, major energy companies reported their highest-ever annual profits from the sale of oil and gas in 2022. The British oil giant BP reported $28 billion in profits, while ExxonMobil reported $56 billion in profits from last year alone. As a result of these windfalls, many energy companies have announced they will be scaling back commitments to move toward renewable energy—a development that is likely to slow the world’s transition away from fossil fuels.
A year ago, Jason Bordoff and Meghan O’Sullivan predicted this feast-before-famine phenomenon, arguing that “talk of a smooth transition to clean energy is fanciful.” In their piece, they discuss how the geopolitics of energy will change as the world moves toward a decarbonized economy—and the risks that could undermine the transition itself.
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