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Introduction from the group chief executive

The outlook facing major energy providers, like BP, is both challenging and exciting.?One of the biggest challenges of our time is a dual one: the need to meet rising energy demand while at the same time reducing carbon emissions
Bob Dudley, group chief executive

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“The value of the?Energy Outlook?is in providing a structure and discipline to our thinking and decision-making. It helps us gauge the range of uncertainties, judge how the risks can be managed, and determine how best to encourage change that puts the world on a more positive and sustainable path.”

Bob Dudley, group chief executive

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The emissions-reduction side of this dual challenge will mean shifting to a lower-carbon energy system, as the world seeks to move to a pathway consistent with meeting the climate goals outlined in the Paris Agreement. Much more progress and change is needed on a range of fronts if the world is to have any chance of moving on to such a pathway.?

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Meeting the other side of the dual challenge will require many forms of energy to play a role. There’s a strong correlation between human development and energy consumption – and our analysis of this relationship in this year’s Outlook highlights the need for much more energy to meet demand as prosperity rises.

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The centre of gravity of energy demand is shifting

There are many other challenges facing our industry as the global energy system evolves. The centre of gravity of energy demand is shifting, with the expanding middle classes in Asia accounting for much of the growth in global GDP and energy consumption over the next 20 years. The pattern of energy supply is also changing, with the shale revolution catapulting the US to pole position as the world’s largest producer of oil and gas, and the rapid growth of liquefied natural gas (LNG) transforming how natural gas is transported and traded around the globe. Meanwhile, the way in which energy is consumed is changing in real time, as the world electrifies and energy increasingly becomes part of broader services that are bought and sold in ever more competitive and efficient digital markets.

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The challenge is to understand, adapt and ultimately thrive in this changing energy landscape.

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Along with these challenges, come opportunities – and that’s what makes this a really exciting time for our industry. Billions of people are being lifted out of low incomes, helping to drive economic growth and the demand for energy. New technologies are revolutionising the way in which that energy is produced, transported and consumed. And the transition to a lower-carbon energy system is opening up a wide range of business possibilities.?

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We are all part of the energy transition

This year’s Energy Outlook provides fresh insight into these trends and many more. The value of the Outlook is not in trying to predict the future. Any such attempt is doomed to fail – the uncertainty surrounding the energy transition is here to stay. Rather the value of the Energy Outlook is in providing a structure and discipline to our thinking and decision-making. It helps us gauge the range of uncertainties, judge how the risks can be managed, and determine how best to encourage change that puts the world on a more positive and sustainable path. Ultimately, we are all part of the energy transition and the decisions all of us make today can shape the future for many years to come.?

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The Energy Outlook plays an important role in helping to inform and shape our strategic decision-making in BP. I hope you find this year’s Outlook a useful contribution to your own discussions and thinking.

Bob Dudley signature

Bob Dudley

Group chief executive

February 2019

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