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Shell says cutting output could worsen living standards

LONDON (AFP) – Shell’s chief executive told the BBC on Thursday that cutting gas and oil output would be “irresponsible” because it could further lift energy bills and worsen the cost-of-living crisis.

Wael Sawan was asked about recent comments from United Nations head Antonio Guterres, who had declared it was “moral and economic madness” to invest in new fossil fuel infrastructure.

Guterres made the remarks in April when he also accused governments and businesses of lying about their efforts to stem climate change.

“I disagree with him, respectfully,” Sawan told the BBC in an interview aired on Thursday.

“I think what would be dangerous and irresponsible is actually cutting out the oil and gas production so that the cost of living – as we saw just last year – starts to shoot up again.”

He warned that strengthening demand from China and cold winter weather in Europe could send energy prices and bills surging.

A Shell petrol station in London. PHOTO: AP

Domestic electricity and gas bills sky-rocketed after key energy producer Russia invaded neighbouring Ukraine early last year.

In turn, that sent inflation surging and squeezed living standards worldwide.

Shell had meanwhile announced plans last month to keep its oil output steady until 2030, triggering outcry from green campaigners.

“The reality is (that) the energy system of today continues to desperately need oil and gas,” Sawan added on Thursday.

“And before we are able to let go of that, we need to make sure we have developed the new energy systems of the future.

“And we are not yet collectively moving at the pace that requires that to happen.”

Shell insists that its overall goal to achieve net zero carbon emissions by 2050 remains intact.