Oil executive warns proposal to cap Russian crude would be difficult to implement.
Shell SHEL 0.58%▲ PLC Chief Executive Ben van Beurden said he expects to see additional taxes on the oil-and-gas industry as a way of helping to protect consumers from higher energy prices, and warned that a price cap on Russian oil being pushed by Western governments would be difficult to implement.
The emphasis should be on protecting vulnerable gas users, particularly poor people, rather than on direct market intervention, Mr. van Beurden told an energy conference in London on Tuesday. Capping the price of Russian oil—an idea pushed by U.S. and European officials—would be a “real implementation challenge,” he said, adding that trying to control prices in sophisticated commodity markets carries risks.
Government intervention probably will require taxing oil-and-gas industry players more, including “people in this room,” Mr. van Beurden said, calling such moves “inevitable.”
The comments come after Shell said last month that Mr. van Beurden would retire at the end of the year after nearly four decades at the London-based oil major, the past nine of which as CEO.
Mr. van Beurden said he finds Shell investors these days more understanding than they were in recent years of the company’s efforts to balance oil-and-gas production with its strategy of transitioning to more sources of renewable energy. Still, he added, “I have to remind investors, we are still investing a significant amount of money in oil and gas.”
A company such as Shell can’t increase oil-and-gas investments by billions of dollars quickly, he said, but it can be flexible with marginal shifts and adjust spending in areas including hydrogen and biofuels in response to demand and its own transition plans. “We will continue to readjust spending to where it makes sense,” he said.
Mr. van Beurden said Europe should be ready for more attacks on key energy infrastructure, possibly endangering energy supplies and distribution, and that more effort should go into preventing such damage. “I don’t think we can be complacent about this,” he said.
A series of recently discovered leaks on the Nord Stream undersea gas pipelines between Russia and Europe are widely presumed to be the result of sabotage. Some Western officials have pointed the finger at Russia. Moscow has also said it believes the leaks were the result of sabotage but has said it had nothing to do with them.
The three-day conference, called the Energy Intelligence Forum, which originated in the 1980s, is convening in person this week for the first time in three years, focused on the geopolitics of energy, with the war in Ukraine at the forefront alongside soaring energy prices. Attendees entering the conference hotel passed a group of protesters who shouted criticism about continued production of oil and gas, saying it endangers the world’s climate.
By Jenny Strasburg.
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