THE FUTURE OF OIL AND GAS: STRATEGIES, CHALLENGES, AND REALITIES OF OIL AND GAS PHASE OUT IN THE G20

The report argues that G20 countries are locked into oil and gas systems due to economic, geopolitical, and institutional factors, despite climate commitments. It highlights a contradiction where G20 nations are on track to produce and consume more than twice the fossil fuels permitted under a 1.5°C pathway. The document analyzes the role of National Oil Companies (NOCs), the limitations of carbon capture and storage (CCS), and the regressive nature of fossil fuel subsidies. It proposes a 'Just Transition Taxonomy' to ensure the phase-out protects workers and marginalized communities, particularly in the Global South, and recommends legislating national phase-out plans and redirecting subsidies toward renewable energy.

• G20 countries are currently on a trajectory to produce and consume more than double the amount of fossil fuels allowed to maintain a 1.5°C temperature limit as defined by the Paris Agreement.
• Fossil fuel subsidies remain high and regressive; in 2023, emerging and developing economies spent USD 620 billion on such subsidies, while G7 subsidies rose to USD 282 billion.
• National Oil Companies (NOCs) are primary drivers of new exploration, controlling over 50% of global oil production and 60% of reserves, often insulated from private climate pressures by state mandates.
• Carbon Capture and Storage (CCS) is criticized as a potential diversion from decarbonization, with approximately 80% of global capacity currently used for enhanced oil recovery (EOR) to extract more oil.
• There is a significant disparity in clean energy finance; emerging and developing economies received only 15% of global renewable investment in 2022, despite representing over half the global population.
• The report identifies a 'transitional gridlock' where G20 nations invest in future technologies like green hydrogen and CCS that are not expected to scale until after 2030, while continuing to use fossil fuels in the interim.
• A phase-out of oil and gas could lead to a 40% drop in fossil fuel tax revenue over the next decade, posing a risk of fiscal destabilization for rentier economies.
• Renewable energy employment is growing but geographically concentrated; in 2023, China accounted for nearly 46% of the 16.2 million global renewable energy jobs.
• The report proposes a 'Just Transition Taxonomy' for the G20 to standardize the classification of policies and investments that support a socially inclusive and environmentally sustainable phase-out.
• The document recommends that governments legislate national phase-out plans, as seen in Denmark's 2020 decision to end oil and gas production by 2050.

APA

Ajith, M., & Ntshwanti, M. (2025). THE FUTURE OF OIL AND GAS: STRATEGIES, CHALLENGES, AND REALITIES OF OIL AND GAS PHASE OUT IN THE G20. Institute for Economic Justice. https://iej.org.za/wp-content/uploads/2026/02/IEJ-G20ResearchReport2025-web-1.pdf

Chicago

Ajith, Meenakshi, and Mzwanele Ntshwanti. THE FUTURE OF OIL AND GAS: STRATEGIES, CHALLENGES, AND REALITIES OF OIL AND GAS PHASE OUT IN THE G20. Institute for Economic Justice, 2025. https://iej.org.za/wp-content/uploads/2026/02/IEJ-G20ResearchReport2025-web-1.pdf.

Wikipedia

{{cite report |last1=Ajith |first1=Meenakshi |last2=Ntshwanti |first2=Mzwanele |title=THE FUTURE OF OIL AND GAS: STRATEGIES, CHALLENGES, AND REALITIES OF OIL AND GAS PHASE OUT IN THE G20 |publisher=Institute for Economic Justice |date=September 2025 |url=https://iej.org.za/wp-content/uploads/2026/02/IEJ-G20ResearchReport2025-web-1.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ajith2025future, author = {Ajith, Meenakshi and Ntshwanti, Mzwanele}, title = {{THE FUTURE OF OIL AND GAS: STRATEGIES, CHALLENGES, AND REALITIES OF OIL AND GAS PHASE OUT IN THE G20}}, institution = {Institute for Economic Justice}, year = {2025}, month = sep, url = {https://iej.org.za/wp-content/uploads/2026/02/IEJ-G20ResearchReport2025-web-1.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }