Ben van Beurden, chief executive of Royal Dutch Shell, has warned that Donald Trump will put American companies at a disadvantage and weaken the US’s global standing if he pulls out of the Paris climate deal.
Mr van Beurden broke ranks with chief executives who have been reluctant to challenge the US president publicly by declaring that Mr Trump’s pledge to abandon the Paris accord would be self-defeating.
“It would be unhelpful on a number of fronts,” he told the Financial Times at the Washington office of the Anglo-Dutch oil company, already an avowed supporter of the Paris deal.
“With the US being the largest investment destination for a company like Shell, yes, I think I would regret having a lot of business here that potentially could be at a disadvantage because of [the] implications of that decision to pull out of Paris.”
Mr Trump has spent weeks weighing whether to act on a campaign promise to quit the agreement on cutting greenhouse emissions, but decision-making has been slowed as the White House has been engulfed in a series of unrelated crises.
“What I think would happen as a consequence of [withdrawal] is that the US would weaken its own hand by basically uninviting itself from a number of [negotiating] tables,” said Mr van Beurden, citing international trade talks as an example.
Mr van Beurden’s comments come a few weeks after Jeff Immelt, the GE chairman and chief executive, called on Mr Trump to keep the US in the Paris climate accord. “We are for staying in the treaty. I think global engagement is a good thing,” Mr Immelt said.
With the Trump administration riven by divisions over Paris, the White House said this month that Mr Trump had delayed his decision on the accord until after a presidential trip to the Middle East and Europe that began on Friday.
Shell is planning to gradually raise its spending on green technology as the world reduces its dependence on fossil fuels, the company’s longtime lifeblood.
If the US backtracks on support for renewable energy built into the Paris deal, it could hurt US manufacturers that have enjoyed growing demand for wind turbines, solar panels and other power equipment.
. . . the US would weaken its own hand by basically uninviting itself from a number of tables.
“The US has a major crop of companies that deliver technologies that are going to be relevant in the energy transition,” said Mr van Beurden, “and one way or another they will also find themselves probably more disadvantaged than advantaged by the US pulling out [of Paris]. So I cannot see where the upside is.”
Aside from an outcry over Mr Trump’s ban on immigration from several Muslim-majority countries, most chief executives have welcomed the president’s pro-business bent and avoided criticising any specific policy moves or controversies.
However, a series of White House setbacks has undermined investors’ hopes of Mr Trump turbocharging the US economy. Last week, US stocks tumbled in response to reports that the president had pushed the then FBI director to drop a Russia probe, but later recovered some of their losses.
Mr Trump has vowed to unleash the full force of fossil fuels and made an early move with an executive order aimed at rolling back President Barack Obama’s attempt to ban drilling in the Arctic and off the US Atlantic coast.
Mr van Beurden said “we’ll take a look” at opportunities in the Atlantic but would not return to the seas off Alaska, where Shell failed to find significant reserves with a well drilled in 2015. “Arctic offshore? No. We’re done with that. We had our episode there. We know what it takes, how difficult it can get.”
No single country can abolish the Paris deal, and advocates of climate change action have put a brave face on Mr Trump’s victory, arguing that the rest of the world would forge ahead even without the US.
Mr van Beurden was not quite so sanguine. “I can only see a weakening of Paris if the US decides to pull out,” he said.
But he added: “Do I believe that therefore the whole energy transition [towards renewables] that we are currently undergoing is going to be reversed? No, absolutely not. I think the US does not have in that sense the ability to reverse what is a global societal trend that is just happening.”
The Shell chief said he welcomed other parts of the Trump agenda that have won widespread praise from corporate leaders: an overhaul of the tax system, more infrastructure investment and less regulation.
Specifically, Shell said that it welcomed Trump administration moves to ease permitting for a petrochemical plant it is building in Pennsylvania and result in less prescriptive rules on drilling in the Gulf of Mexico.
But Mr van Beurden said he had not made any investment decisions differently because of the outcome of last year’s election.
“Every investment decision that we take right now will probably only become economically seriously relevant after the current president’s term,” he said.
“So how on earth could you ever be driven by that? Unless you are in a business where your investment horizon is a matter of months [and] your payback is a matter of a few years, which is just not the case for us.”
