https://www.barrons.com/articles/bp-shell-oil-gas-demand-renewables-russia-energy-51675074243BP lowered its long-term oil and gas demand outlook as it said Russia’s war in Ukraine will accelerate the global shift toward renewable energy in a report Monday.In its 2023 energy outlook, the British oil giant cut its oil demand forecast in 2035 by 5%, compared with last year’s report, while it sees natural gas demand 6% weaker. BP raised its 2035 demand outlook for renewables 5%, and nuclear by 2%, in its central scenario based on government decarbonization targets.“The increased importance placed on energy security as a result of the Russia-Ukraine war leads over time to a shift away from fossil fuels towards locally produced non-fossil fuels, accelerating the energy transition,” BP said Monday.The company said the impact was concentrated in Asia and the European Union, as both are currently heavily reliant on oil and natural gas imports.Separately, Shell announced an overhaul of its business units Monday, in one of the first major moves by new CEO Wael Sawan. The company said its oil and gas production and liquefied natural gas business will combine into one entity. Shell’s renewables unit will also combine with its oil refining and marketing operations.In a further move, the energy giant’s executive committee will be cut to seven from nine members in a bid to “simplify the organization further and improve performance.”Oil companies such as BP and Shell had a stellar 2022 as higher oil and gas prices led to record quarterly profits. This year could still be a good one but is unlikely to match that as prices cool from highs.The potential acceleration in the global shift toward clean energy should benefit BP and Shell, which are both investing about $1 billion a year in low-carbon energy such as electric-vehicle charging, hydrogen, wind, and solar power.BP stock climbed 0.5% in early London trading, while shares in Shell were 0.1% up.
