National oil companies could be early winners on the road to ‘net zero’
IEA roadmap poses big strategic opportunity for those sitting on the cheapest barrels
Oil-rich nations face an historic opportunity to seize market share as the world strives to pivot away from crude. State-owned oil companies can either string out supply while rivals fall by the wayside, or race to get their resources to market before it’s too late. Either way, those sitting on the cheapest barrels face fewer risks to monetising their reserves on the road to ‘net zero’ – although all oil suppliers will be squeezed along the way.
National oil companies (NOCs) face a strategic dilemma from decarbonisation, but one that could allow them to keep paying dividends if navigated to their advantage, the International Energy Agency’s 2050 ‘net zero’ roadmap implies.
If they play their cards right, NOCs could enjoy decades of firm (albeit lower) demand for crude exports as other more expensive suppliers are priced out of a declining market.
The IEA’s Net Zero Emissions (NZE) scenario assumes that NOCs restrict investm…