VIJAY JAYARAJ: Energy Transition Meltdown Could Mean Global Bifurcation

History will likely remember 2025 as the year energy corporatists finally stopped pretending there is a climate crisis. For a decade, a bizarre theater of the absurd played out as titans of the oil and gas industry apologized for their core business while pledging allegiance to a “green transition” that existed mostly in the imaginations of Western bureaucrats. But the curtain has seemingly fallen.

ExxonMobil, one of the world’s largest energy producers, hasslashed $10 billion from its low-carbon investment commitments through 2030.  Simultaneously, the company announced that it expects $25 billion in earnings growth from 2024 to 2030 to be powered primarily by increases in oil and gas production, which will push daily output to 5.5 million barrels of oil equivalent by the end of the decade.

This is not a company abandoning climate responsibility but rather at last recognizing what has long been obvious: The path prescribed by the climate industrial complex is economically destructive and operationally impossible – even with massive government subsidies.

For years, the global energy strategy has been surreal. Companies that built the modern world on the back of energy-dense hydrocarbons indulged those celebrating the arrival of wind turbines and solar panels to power civilization. But reality, stubborn and unforgiving, has interrupted the psychedelic revelry.

ExxonMobil’s low-carbon investments will be paced to policy support and customer demand, says the company. That is corporate speak meaning that spending on green projects is paused unless the government – using our tax dollars – subsidizes the risk or until a market exists.

Megaprojects, once heralded as the future, are now in line for deferral. Why? Because without taxpayer handouts, the economics of trying to bury underground a plant food like carbon dioxide simply do not work – and defy common sense.

The energy sector is pivoting from a strategy of “grow clean at all costs” to “returns first, transition last.” “Green” projects are being relegated to a secondary capital bucket – a token for good PR instead of a core activity.