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February 18, 2023
Climate Justice

The external costs of the climate crisis must be paid by the multinational oil companies, not by the citizens

Insight by Sara Manisera, FADA Collective

One of the world's largest oil companies - the US company ExxonMobil - predicted a rise in global temperature as early as the 1970s. According to researchers who analysed the data contained in the company's internal documents - as reported by The Guardian and the BBC last January - the oil company knew that the burning of fossil fuels would warm the planet. 

The company - reached by the Anglo-Saxon media - denies it. A classic attitude, also well recounted by journalist Stella Levantesi in her book I bugiardi del clima, Ed. Laterza. For decades, multinational oil companies have denied the link between fossil fuels and global warming. Not only that. They have paid millions of dollars in lobbying, constructed false narratives and manipulated the reality of the facts. As Naomi Oreskes, a professor of the history of science at Harvard University, explains to the BBC: "The findings demonstrate the strong hypocrisy of ExxonMobil executives who were aware of the work their scientists were doing and had access to this insider information, while they told us that the climate models were hogwash". 

Over the decades, major oil and gas companies such as Exxon Mobil, TotalEnergies, BP, ENI, Shell, Repsol, have made billions selling fossil fuels, which are responsible for the emission of greenhouse gases that have accelerated global warming and the ongoing climate crisis.

In fact, over all these years, while the companies continued to carry on business as usual, some of their costs and negative externalities were passed on entirely to society and citizens, the environment and health.

In other words, oil spills, air, water and soil pollution, health impacts on those living next to oil wells, refineries or in what could be called the 'hydrocarbon peripheries', have been and will be entirely paid for by citizens and future generations. 

As Léa Pham Van and Gerard Rijk, authors of the report 'European Big Oil. The Big Responsibility for Carbon Emissions, Pollution and Health Costs', published in April 2022, "several major oil spill events have occurred since 1993 that can be linked to European oil companies. These have caused damages amounting to EUR 59 billion. To these costs must be added the costs of environmental pollution that have not been paid for by European Big Oil and have not received media attention: through court cases, for example, Big Oil has been able to pass these costs on to governments, the public and the environment. For the period 1993-2020, these unpaid costs in terms of pollution are estimated at EUR 11.1 billion, but this does not include large externalities, such as the costs of deforestation or the impact on indigenous peoples severely affected by the activities of multinational oil companies". 

While it is true that corporations have paid corporate taxes - although many of them are registered in countries with advantageous tax regimes, e.g. Eni in the Netherlands - a whole series of negative externalities are entirely paid for by citizens. Starting with the indirect costs on health and the environment

And while it is true that we live in increasingly energy-intensive societies, it is also true that there are few installations for renewables. For decades, politicians have consciously chosen not to invest in renewables, preferring to maintain toxic ties with dictatorships and regimes to import gas and oil. 

Such important choices - like energy planning - require a visionary policy capable of planning for the medium and long term. And they require active and informed citizens, capable of understanding local dynamics (e.g. rising petrol prices) linked to global dynamics (agreements with Egypt, Algeria, Iraq, etc.).

That is why we need a free press, not financed by the oil multinationals, and we need to bring to the centre of the public debate the discussion on the indirect social and environmental costs of an economic system that passes them on to the citizens. We can no longer afford to allow business as usual to continue. 

The time has come to start imagining a system that makes polluters pay these costs. And that rewards, on the contrary, virtuous companies that hold together social and environmental sustainability. A hundred years ago, a united Europe with shared rules was unthinkable. Why can't we imagine an international legal system protecting the planet and that gives rules to these large corporations? It is unthinkable today, but we need to imagine the unthinkable so that it becomes concrete tomorrow.

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