Analysis shows 2021 fossil fuel subsidies nearly doubled globally to $697B

Aug. 31 (UPI) -- Fossil fuel subsidies nearly doubled globally in 2021 to $697.2 billion, according to the International Energy Agency and Organization for Economic Co-operation and Development.

These fossil fuel investments by major world economies are a roadblock to a more sustainable energy future, according to a statement from IEA Executive Director Fatih Birol.

"Fossil fuel subsidies are a roadblock to a more sustainable future, but the difficulty that governments face in removing them is underscored at times of high and volatile fuel prices," Birol said. "A surge in investment in clean energy technologies and infrastructure is the only lasting solution to today's global energy crisis and the best way to reduce the exposure of consumers to high fuel costs."

OECD Secretary-General Mathia Cormann blamed Russia's war on Ukraine for destabilizing energy security by causing prices to spike while reducing or cutting off energy supplies to Europe.

"We need to adopt measures which protect consumers from the extreme impacts of shifting market and geopolitical forces in a way that helps keep us on track to carbon neutrality as well as energy security and affordability," Cormann said in a statement.

The research from IEA and OECD shows budget transfers and tax breaks supporting fossil fuel energy "reached levels not previously seen," rising to $190 billion in 2021.

According to OECD, G20 nation fossil direct fuel producer support hit $64 billion in 2021. Consumer support for fossil fuels reached $115 billion in 2021.

Both the IEA and OECD continue to call for the "phasing out of inefficient fossil fuel support and re-direction of public funding toward the development of low-carbon alternatives alongside improvements in energy security and energy efficiency," according to their statement.