Saudi Aramco CEO warned that an excessive contraction in new fossil fuel investment would trigger inflation and social unrest

A global energy conference dedicated to future technologies and low-carbon strategies kicked off in Houston on Monday, with CEOs of global oil giants including Saudi Aramco, Chevron and Exxon Mobil saying that even as the world transitions to cleaner fuels, more fossil fuels will be needed in the coming decades.

Amin Nasser, chief executive of Saudi Aramco, the world's largest oil producer, urged global leaders to continue investing in fossil fuels for years to come, arguing that the assumption that the world could transition to clean energy "overnight" is "deeply flawed."

Nasser said an overly rapid transition to clean fuels could lead to uncontrolled inflation and social unrest, and ultimately upend countries' emissions targets to curb carbon pollution.

"I understand that publicly acknowledging that oil and gas will play an important role during the transition period and beyond will be difficult for some people," Nasser said. "But as energy prices become unbearably high, countries' net zero commitments begin to unravel, and acknowledging this reality is much easier than dealing with energy insecurity, rampant inflation and social unrest."

Nasser's remarks come as countries set new carbon reduction targets to combat climate change, and the oil and gas industry is under increasing pressure to limit fossil fuel exploration and production and shift to renewable energy development.

In May, the International Energy Agency (IEA) warned that investment in new oil and gas projects must be halted immediately in order to achieve net-zero emissions by 2050 and avoid the worst consequences of climate change.

According to the Intergovernmental Panel on Climate Change (IPCC), for global temperatures to rise no more than 1.5 degrees Celsius, countries around the world will need to cut greenhouse gas emissions by nearly half over the next 10 years and achieve net zero emissions by 2050. At present, the Earth's temperature has risen by 1.1 degrees Celsius from pre-industrial levels, and it is expected to rise by 2.4 degrees Celsius by 2100.

Other world energy leaders in attendance, including celebres of ExxonMobil and Chevron, also believed that despite efforts to transition to a clean energy economy, demand for oil and gas will remain high for years to come.

"Oil and gas continue to play a central role in meeting the world's energy needs, and we also play a vital role in providing these energy sources in a low-carbon manner." Chevron CEO Mike Wirth said at the conference. "Our products make the world work."

ExxonMobil on Monday unveiled plans to achieve net-zero emissions in oil and gas field operations in West Texas and New Mexico by 2030 as part of the company's efforts to curb carbon emissions across its entire business. During the meeting, the company's CEO Darren Woods highlighted the continued demand for fossil fuels during the clean energy transition.

As the world economy recovers from the COVID-19 pandemic, global demand for fossil fuels has rebounded sharply this year. Global carbon emissions from fossil fuel burning are expected to increase to 36.4 billion tonnes, or 4.9 percent, compared to 2020.