Oil Prices and their Impact on Global Carbon Dioxide Emissions

McCollum, D., Jewell, J. ORCID: https://orcid.org/0000-0003-2846-9081, Krey, V. ORCID: https://orcid.org/0000-0003-0307-3515, Bazilian, M., Fay, M., & Riahi, K. ORCID: https://orcid.org/0000-0001-7193-3498 (2015). Oil Prices and their Impact on Global Carbon Dioxide Emissions. In: Systems Analysis 2015 - A Conference in Celebration of Howard Raiffa, 11 -13 November, 2015, Laxenburg, Austria.

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Oil prices took a dramatic plunge starting in late 2014 and have remained low ever since. Combined with parallel developments in natural gas supply, this plunge has prompted questions regarding what the “new normal” might mean for energy markets. Will falling oil and gas prices damage the business case for mitigation technologies, such as renewables? Will they stymie incentives to invest in energy efficiency? How do cheaper oil and gas change the outlook for coal and nuclear? Does this spell bad news for efforts to mitigate climate change? While many have weighed in on these questions, no scientific studies have yet addressed them, at least not since the most recent drop in oil prices. A number of economic analyses have studied the very near-term impacts of oil price shocks; meanwhile, scenarios have explored diverging futures where oil prices vary along with multiple other drivers. As yet, however, there has been no explicit and systematic assessment of the longer-term consequences of different oil price futures for global CO2 emissions. Here we present work using the MESSAGE integrated assessment model, wherein we develop and analyze scenarios with wide-ranging price assumptions that are in line with recent market fluctuations. We find that whether oil prices are stubbornly low or consistently high for decades will have a moderate impact on global emissions and society’s ability to mitigate climate change, even though the fuel mix would look quite different in these alternative futures.

Item Type: Conference or Workshop Item (Poster)
Research Programs: Energy (ENE)
Depositing User: Michaela Rossini
Date Deposited: 19 Jan 2016 14:49
Last Modified: 14 Jun 2023 13:23
URI: https://pure.iiasa.ac.at/11795

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