Governments should tackle oil, gas demand to avoid price shocks -CEOs

London — Governments should focus more on tackling consumer dependence on fossil fuels in the energy transition to avoid future oil and gas price shocks, the heads of leading energy companies said on Wednesday.

“As policies around the world change and governments look to try to reduce their economies’ dependence on oil and gas … if we don’t balance the demand equation and only address the supply, it will lead to additional volatility,” Exxon Mobil Chief Executive Darren Woods told an energy conference in Moscow.

Benchmark natural gas prices soared to record highs while oil prices rose to multi-year highs in recent weeks on concerns over limited supplies due in part to lower investments in new projects in recent years.

Western oil and gas companies are under heavy pressure from investors and governments to shift to renewables such as wind and solar power to reduce greenhouse gas emissions in the coming decades to tackle global warming.

“At the end of the day, if supply goes away and demand doesn’t change, that only has one consequence and that is an escalation in price rises,” BP CEO Bernard Looney told the conference.

Governments around the world have set out plans to sharply reduce their economies’ carbon emissions in the coming decades to meet the 2015 Paris climate agreement to limit global warming.

Speaking at the same event, President Vladimir Putin said that Russia was ready to provide more gas to Europe if requested, emphatically rejecting the suggestion that Moscow was squeezing supplies for political purposes.