Royal Dutch Shell, one of the multinationals that has defined the oil industry, is slowly turning away from the fossil fuel that made its fortune over the decades but also worsened a global climate crisis.
The company said Thursday that its production of oil peaked before the coronavirus pandemic and will fall steadily as it attempts an ambitious pivot toward less polluting forms of energy. It’s a milestone for the company and reflects the urgency facing governments and companies to reduce climate-warming emissions.
Shell unveiled new plans for reaching its goal of being carbon neutral by 2050 that include a 1% to 2% drop annually in oil output. It will eliminate seven of its 13 refineries and aims to cut production of gasoline and diesel fuel by 55% over the next decade.
The plan is part of a wider push, particularly among European oil companies, to overhaul their operations to reduce carbon emissions blamed for global warming while still making money. BP said last year that it wants to eliminate or offset all carbon emissions from its operations and the oil and gas it sells to customers by 2050.
Critics say energy companies have been moving too slowly to cut carbon emissions amid a United Nations drive to limit temperature increases to no more than 1.5 degrees Celsius (2.7 degrees Fahrenheit) over pre-industrial levels.
“Our accelerated strategy will drive down carbon emissions and will deliver value for our shareholders, our customers and wider society,” Shell’s CEO, Ben van Beurden, said in a statement.