The war in Ukraine has notably led to a “soaring energy price” and therefore a greater use of fossil fuels to “ensure energy security” and “keep energy at affordable prices”.
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Major economies have significantly increased their support for the production and consumption of coal, oil and natural gas, according to a new analysis from the OECD and the International Energy Agency (IEA) published on Monday (August 29th). “Fossil fuel support nearly doubles in 2021, holding back progress towards international climate goals”says the OECD in a press release.
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Many countries are struggling to find a balance between long-standing commitments to remove inefficient fossil fuel subsidies and measures to protect households from soaring energy prices, according to the two organisations. New data from the OECD and IEA shows overall public support for fossil fuels in 51 countries around the world has almost doubled, from $362.4 billion in 2020 to $697.2 billion in 2020. 2021, with rising energy prices associated with the recovery of the global economy. “As these prices and energy consumption continue to increase, it is expected that consumer subsidies will increase further in 2022”warns the OECD.
The war in Ukraine has consequences in this context, according to the organization. “Russia’s war of aggression against Ukraine has caused energy prices to soar and undermined energy security. Significant hikes in fossil fuel subsidies nevertheless promote overconsumption without necessarily helping low-income households”said OECD Secretary-General Mathias Cormann. “We must adopt measures that protect consumers from the extreme impacts of fluctuating market forces and geopolitical forces, and that allow us to simultaneously stay on the course of carbon neutrality, ensure energy security and maintain energy at affordable prices.
“Fossil fuel subsidies are an obstacle to a more sustainable future, but the problems governments face when trying to overcome them are exacerbated in times of rising and volatile oil prices. energy. Increasing investment in clean energy technologies and infrastructure is the only sustainable solution to the current global energy crisis, and the best way to reduce consumer exposure to high fuel costs.”said IEA Executive Director Fatih Birol.