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How EU Can Decrease Its Dependency Upon Crude Oil?

by | Jun 17, 2022 | Green Energy, Natural Resource Management

Introduction

Energy fuels the economy. The prosperity and security of the European Union (EU) depend on an affordable and stable supply of energy. Energy policies in the EU have driven significant change in recent years. EU energy producers have recorded a drop in the most polluting fuels as energy consumption moves towards renewable sources and natural gas. While renewable energy production has grown substantially in Europe over recent years, natural gas production has declined. The declination has led the EU to increase its dependency on gas imports. Contrastingly, EU leaders have started serious discussions on how EU can decrease its dependency upon crude oil.

The EU recorded its peak crude oil production in 2004 at 41.7 million tonnes (Mt). However, by 2020, the production of crude oil had decreased significantly. It reached its lowest point at 18.7 Mt. This low production happened in response to a drop in crude oil demand caused by the COVID pandemic. The top crude oil producers of 2020 were Italy, Denmark, and Romania with 5.4 Mt, 3.5 Mt, and 3.3 Mt, respectively.

The Dangers of Being Dependent on Crude Oil

In 2020, the EU imported 440.3 Mt of crude oil. Most of the imports came from Russia, Norway, Kazakhstan, the USA, and Saudi Arabia. Crude oil imports from Russia peaked in 2005 and have declined since then. Crude oil imports from Kazakhstan and the USA have risen sharply over the recent years.

The EU’s overwhelming dependence on oil and oil imports presents a subtle and severe threat to national security. The EU imports some of its oil from countries with long-term conditions that make a region dangerous or unstable. These countries include Algeria, Nigeria, Saudi Arabia, and Syria, among others. The EU’s reliance on oil exports from these countries could compromise national security, economy, and the environment.

Moreover, the regimes and elites that economically benefit from selling oil rarely share those revenues with their people. This creates more significant economic disparities in those countries.

The EU’s sizable crude oil appetite also contributes to another growing concern for national security: climate change. Burning oil is one of the largest sources of carbon emissions and a severe driver of climate change. Therefore, if left unchecked, oil consumption could have devastating global implications.

Recent studies found that climate change could intensify terrorist actions and destabilize governments. Frequent extreme weather events could displace millions of people through food and water shortages and rising sea levels. Global warming will put the world’s poor at the most risk since richer countries can better adapt to a changing climate.

Also, oil spills on ships, trains, trucks, and pipelines contaminate soil and water. Oil spills have devastating environmental impacts and put regions at risk of catching fire. Oil spills in the oceans and seas destroy marine life.

EU’s Dependency on Crude Oil

Source

EU depends to a great degree on oil imports to meet its energy needs. Most recent data show that crude oil and petroleum account for almost half of the EU’s energy consumption. Most of the crude oil demand comes from the road transport sector.

Although energy demand in the EU has fallen in recent years, domestic crude oil extraction has fallen even faster. In 2018, the UK accounted for nearly 70% of the EU’s crude oil extraction. Therefore, the departure of the UK from Europe led to a drastic decrease in the EU’s crude oil production. This led to an increased dependency on oil imports. As of 2018, 96% of the EU’s crude oil supply was met by imports.

The transport sector accounts for more than two-thirds of the EU’s crude oil and petroleum demand. The massive dependence of the transport sector on crude oil and petroleum poses an issue. It will be hard to find substitutes for petrol and diesel in the short term.

Since 2015, the EU has increased its imports of crude oil. The low global oil prices drove a reduction in domestic oil production and an increase in demand. The EU imports a high proportion of its crude oil from geopolitically unstable regions. These regions have seen an increase in wars, terrorism, and internal and border conflicts. Therefore, European consumers and industries face a risk of oil supply shortages and interruptions. Over 80% of European crude oil imports are from non-European countries.

Accelerating the European Green Deal

The EU has identified two priorities to reduce dependency on crude oil. These two elements are already the central pillars of EU energy policies. They are:

1. Ramping up renewable energy production

2. Boosting energy efficiency

The targets set by the EU in 2018 and 2019 aim at increasing renewable energy and energy efficiency by 2030, resulting in a 40% reduction in greenhouse gas emissions. However, last year, a committee proposed accelerating the shift to clean energy, aiming to achieve 55% greenhouse gas reductions by 2030.

RePower EU, the EU’s plan to make Europe independent from fossil fuels, also identified the potential for moving faster toward wind and solar power. In May, the commission is set to propose a strategy promoting rooftop solar energy. The plan also suggests that biomethane can play an essential role in making Europe independent from fossil fuels. The project also considers renewable hydrogen a primary new alternative energy supply source.

The commission knows that there will be bottlenecks hindering renewable energy projects. The commission will publish a recommendation on fast approving permits for renewable energy projects to address this challenge.

The RePower EU commission has also highlighted ways by which EU citizens can reduce overall energy consumption and increase energy savings. They suggest turning off lights, using public transport, lowering the room temperature, and using lids on saucepans, among others. The commission is also working with the International Energy Agency, stakeholders, and consumer organizations to discuss ways citizens can further contribute to overcoming the challenge of how the EU can decrease its dependency on crude oil.

 

Author

  • The author has done a master's in Environmental science and is currently working as chief Environmental Advisor with New Delhi State Government.

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