OPINION: Production performance and the outlook for the prolific Permian shale play took centre stage as the major US-based oil and gas companies reported on their second quarter results in the past week.

Major new developments in areas including the Gulf of Mexico and Guyana, global liquefied natural gas projects and cash returns to shareholders were also among the hot topics as top US oil executives laid out their results and outlooks for investors and analysts.

Many of the comments from US-based players such as Chevron, ExxonMobil and ConocoPhillips on markets and outlook echoed those of their European rivals which reported earlier.

However, in one respect, the contrast was noteworthy: while supermajors BP and Shell talked at length about their role in the ongoing energy transition and highlighted their efforts within renewable energy and low-carbon technologies, the US players only mentioned such activities in passing, or in the case of ConocoPhillips, not at all.

Thanks to the growth of shale production, the US companies are, in the words of Chevron’s chief financial officer Pierre Breber, “in the midst of an energy revolution”.

US oil and gas output has surged in the past decade, with oil set to reach record levels of 12.3 million barrels per day this year and 13.3 million bpd in 2020, according to a report this week by the Energy Information Administration (EIA).

While European governments have ambitious targets to cut emissions and replace fossil fuels with renewable energy, and are pushing energy companies to join in the efforts through financial incentives and political pressure, the current US administration is doing little to encourage producers to prepare for a low-carbon future.

Even so, the companies are taking steps to cut emissions and branch out, though at a less ambitious level than their European counterparts.

Chevron is investing in biomethane production, electric vehicle charging technology and carbon capture, and ExxonMobil is investing in lower-emissions technologies, and all are seeking to keep flaring to a minimum.

It would be wrong to say the US operators are ignoring the move towards low carbon but on a global scale, they are lagging.

Already in 2014, a group of 10 oil companies led by European players such as BP and Shell, initiated the Oil & Gas Climate Initiative (OGCI), a group that aims to cut methane emissions by more than one-third by 2025.

Chevron, ExxonMobil and Occidental only joined last September, becoming the first US members.

As the US players spoke glowingly of Permian output, a couple of other recent news items emphasised the need for the oil and gas industry to get ready to compete against low-carbon technologies.

Figures from Wood Mackenzie released this week showed that, within a couple of years, the cost of installing a residential solar power and storage system in Germany and Italy will match the cost of buying electricity from the grid — power produced in part by natural gas. Other markets are likely to follow.

Also in the news was Tesla, which launched its utility-scale Megapack power-storage battery that will allow renewable energy companies to balance out intermittent production without buying electricity from gas-fired power plants.

In both cases, new technologies may reduce the role of natural gas a bridge fuel.

While surging output from the Permian and fossil-friendly domestic policies will help protect the US players’ profits for some time ahead, they will also need to look beyond petroleum if they want to stay in business through an energy transition that will eventually reach them too.

(This is an Upstream opinion article.)