So an oil cartel enters a climate summit…

In a remote corner of the temporary village hosting the United Nations climate summit, the world’s largest cartel of fossil fuel producers plied skeptical young activists with chocolate and free pens.

It was Thursday afternoon. A continent away, in Vienna, cartel members voted to give the summit another very small climate treat: at least a temporary reduction in oil and gas drilling. That is the opposite of what President Biden, who has made climate policy a top priority during his administration, is putting forward from the United States.

It was the irony on the opening day of a COP28 summit that is already full of them, from the host country to the so-called OPEC pavilion in a building labeled ‘Urbanisation & Indigenous Peoples’ on the outside.

Tens of thousands of delegates will descend this month on Dubai in the United Arab Emirates, which is a member of the Organization of the Petroleum Exporting Countries and a major oil producer. These delegates celebrate an accelerating global transition to low-emission energy sources such as wind and solar energy. But expanding renewable energy sources is not enough to save the planet, scientists warn. That is why many delegates are demanding that the world quickly phase out the use of fossil fuels.

There is still no consensus at the summit on how this should be done.

The members of OPEC decided to make a small version of it, at least for the first three months of next year. They agreed to voluntarily and temporarily limit oil production by approximately two million barrels of oil per day.

The move was motivated by profit calculations, not by concerns about emissions. It is still a long way from the sharp reduction in fossil fuel use that the International Energy Agency says is necessary to stabilize global temperatures before catastrophic warming occurs.

“Reducing fossil fuel emissions means reducing demand for fossil fuels,” said Fatih Birol, the agency’s executive director. wrote online Thursday. “There’s no way around this.”

Oil demand is still growing worldwide, but at a slower pace than last year. That slowing improvement, and the prospect that demand could actually begin to decline in the near future, has changed the economics of the global energy market.

That market is increasingly shifting away from oil heavyweights like Saudi Arabia and Russia, both of which belong to what is known as OPEC Plus. And they’re a big reason OPEC has curtailed production and settled on the edge of the Dubai conference’s Blue Zone, handing out booklets in a cramped office space no bigger than a studio apartment.

Consumers in China, the United States and other major economies are increasingly choosing electric cars and trucks over gasoline-powered cars. Government policies around the world have led to major improvements in fuel economy and other energy efficiency measures.

The International Energy Agency predicts that global demand for oil, natural gas and coal will peak in 2030 as governments make good on pledges to do even more to reduce emissions. OPEC officials say that peak won’t come until 2045. But cartel countries can already see how declining demand is hurting their prices and profits. They are trying to prevent prices from collapsing further.

So countries are restricting supply, choosing to keep millions of barrels of oil in the ground every day that would otherwise have been extracted, hoping to sell the rest of their oil at a higher price.

That is basic cartel economics. It will have at least a temporary effect and increase the cost of gasoline and other petroleum products. That should cause people to buy less of these products, but it could also encourage additional drilling in non-OPEC countries by keeping prices higher than they would have been.

This measure could have an even greater impact if not for a renewed drilling boom in the United States, which is producing a million barrels of oil per day more than a year ago and helping to drive down prices. US production is responsible for 80 percent of the increase in global oil supply this year, the energy agency has calculated.

OPEC is essentially losing power in the oil market, at a time when oil is losing power among cost-conscious and climate-conscious consumers.

Against this backdrop, OPEC set up its modest exhibition space in Dubai. Employees handed out pamphlets with titles such as “The Story of Petroleum” and chocolate bars wrapped in OPEC-branded packaging. They showed a diorama of a Saudi project to capture carbon dioxide emissions from fossil fuel plants and then store or use them by injecting the compressed gas into new drilling sites.

The employees patiently answered a reporter’s questions about what it was like to be an oil cartel at a climate conference.

Hind Zaher, an OPEC public relations specialist who worked at the pavilion, said the visitors had been friendly and knowledgeable. “A lot of people are coming and they are eager to learn more about OPEC,” she said. “It looks good for the first day.”

During a 15-minute visit to the pavilion in the afternoon, two young summit participants passed by. One of them asked for directions to another building.

The other asked about the free pens.