At the start of 2021, the oil majors find themselves at a crossroads. Their old business models are failing and the world is clearly already in the midst of an energy transition.
Beginning last year, the European majors began a tentative step towards a shift in the direction of cleaner energy. In contrast, the American oil majors dug in their heels and doubled-down on oil and gas drilling. Either way, the financial pain that has enveloped the oil majors is likely just beginning.
French oil giant Total is arguably going furthest in its efforts at transition, pledging last year to “grow by one-third, roughly from 3 million BOE/D (Barrels of Oil Equivalent per Day) to 4 million BOE/D, half from LNG, half from electricity, mainly from renewables.” It’s something of the beginning of a “blueprint for how to transition on oil company into an energy company,” according to a recent commentary by IEEFA.