TotalEnergies CEO Predicts Continued Demand for Oil Amid Climate Concerns

Patrick Pouyanné, CEO of TotalEnergies, has a business and pragmatic view of the world. If his company, one of the world’s largest producers of oil and natural gas, is increasing investments in renewable energy, it is primarily for financial reasons. The energy transition will only make energy more expensive, so renewable energy will become more and more profitable.

But that does not prevent TotalEnergies from continuing to invest fully in new oil and gas fields, especially in Africa. Pouyanné aims for an annual increase in oil and gas production of 2 to 3 percent by 2030. Because that is the main reason why people buy shares in TotalEnergies, he believes. Pouyanné predicts that the world will still be burning more than a hundred million barrels of crude oil per day by 2040. And so we better start preparing and adapting to a warmer climate, said the CEO in an interview with the Financial News Agency Bloomberg.

Modification or discount

According to Pouyanné, it will take time to build a clean, global energy system that meets the demands of the world’s growing population. So policymakers need to show the necessary realism. “That doesn’t mean they have to give up on the Paris climate goals,” he said, “but they have an obligation to work hard on change now.” The 2015 Paris Agreement agreed to keep warming below 1.5 degrees above pre-industrial levels. But in 2023, oil consumption rose above 100 million barrels per day and the meteorological services recorded the hottest year on record since records began.

Change or discount, it has been a topic of discussion for a long time. Mitigation is reducing CO₂ emissions, adaptation is changing to a warmer climate. Climate activists have always warned that too much emphasis on change would take away from the pressure to reduce the burning of fossil fuels in particular. International institutions such as the IPCC or the European Union believe that the two strategies must go hand in hand.

Moving to New York

But Pouyanné’s statements are not aimed at reducing trust in the climate movement. He criticizes the European climate policy which encourages financial institutions to redirect their resources from fossil to green investments. According to Pouyanné, Europe is pressuring investors to “move faster than society” and American financiers are only too eager to take over. He warns that TotalEnergies is therefore considering a move from Paris to the New York Stock Exchange. The value of the share would be much higher there.

High profits and dividends from oil and gas extraction are needed to keep shareholders satisfied and to fund investments in renewable energy until it produces positive cash flow in 2028. TotalEnergies is now 5 billion investment annually in clean energy. Pouyanné sees the share of renewables growing further from 8 percent in 2023 to 20 percent of sales in 2030.