Indexbit Exchange:Brazil’s Lula takes heat on oil plans at UN climate talks, a turnaround after hero status last year

DUBAI,Indexbit Exchange United Arab Emirates (AP) — Fresh off election victory, a year ago Brazilian President-elect Inacio Lula da Silva was the star of the annual U.N. climate talks.

Lula promised to crack down on deforestation and turn Brazil into an environmental leader, a complete turnaround after President Jair Bolsonaro rolled back regulations and encouraged land-grabbing in the Amazon.

“Lula! Lula! Lula!” many onlookers screamed during Lula’s many events at COP27 in Egypt.

What a difference a year makes.

Just as Lula addressed world leaders at COP28 in Dubai, it was announced that Brazil would join OPEC+, a group of big oil-exporting countries, including Russia. At one event during the conference, Lula tried to explain the decision by saying that, once on the inside, the South American nation would push other oil-producing countries to transition to green energy—a curious explanation given that state-run oil company Petrobras is focused on further oil exploration. Lula later clarified that Brazil would be an OPEC observer, not a full member.

In his speech to world leaders, Lula implored delegates to go beyond “eloquent but empty words.” In a subsequent session with Environment Minister Marina Silva, Lula teared up when he talked about the need to protect forests.

Instead of chants of adulation, Brazil received a Fossil of the Day award from Climate Action Network International, a non-award given to countries whose actions support fossil fuels, the main cause of climate change.

Natalie Unterstell, president of Talanoa, a Brazilian think tank focused on climate, said Lula’s approach to the environment was focused on curbing deforestation, Brazil’s largest source of carbon emissions, which his administration has managed to slow by half since taking office in January. That approach served him well during his first terms, between 2003 and 2010, but that is no longer enough, she said.

“Lula can’t be a climate leader without a real energy transition policy,” she said. “It’s time for him to update his programming software.”

Lula has had a long and complicated relationship with oil. When huge reserves were discovered off Brazilian shores in 2006, Lula said: “This discovery ... proves that God is Brazilian.” Indeed, as the Brazil became a major oil-producer over the next decade, the money helped Lula, and then successor President Dilma Rousseff, fund major social programs that lifted tens of millions of people from poverty.

Today, Brazil is the world’s ninth largest producer, with 3% of global output, according to the U.S. Energy Information Administration. Oil has become so important that it’s now Brazil’s second export product after soy, producing 3.67 million barrels a day. By far, China is the country’s largest buyer.

At a climate conference focused on reducing planet-warming greenhouse gas emissions, which oil and gas products let off when burned, environmentalists have been quick to note the contradiction.

Meanwhile, Petrobras is doubling down on oil. On Dec. 13, a day after the climate conference is scheduled to end, the country is going to allow companies to bid on 33 areas with blocks for oil exploration, according to Brazil’s National Agency of Oil, Natural Gas and Biofuels, including some in the Amazon rainforest. It’s part of a push to offer more than 900 blocks in December.

In a written response to the AP, the National Agency of Oil, Natural Gas and Biofuels declined to comment on demands for energy transition, arguing that, as a regulatory agency, it “does not create public policies but rather implements the policies formulated by the government.”

The increased exploration, which eventually leads to more production, threatens to cancel out or even surpass gains from Brazil’s efforts to stop net deforestation by 2030, according to the Greenhouse Gas Emission Estimation System, an initiative by the Climate Observatory, a network of environmental nonprofit groups.

“The damage (of the exploration) goes against any positioning of Brazil as a climate leader,” said David Tsai, projects coordinator at the Institute for Energy and the Environment, which is part of Climate Observatory.

While Lula fumbled during the few days he spent at COP28, his Colombian counterpart, leftist Gustavo Petro, seemed to be taking the mantle of environmental leadership in Latin America. In contrast to Brazil’s alignment with OPEC, Petro joined an alliance of nations supporting a fossil fuel non-proliferation treaty. “This is not economic suicide,” he said in Dubai. “It’s about preventing humanity’s self-destruction.”

The leaders’ differing visions were on display in August during the Amazonian summit in Belem. Lula and other leaders vetoed Petro’s proposal to ban oil production in the world’s largest rainforest. Similar to the ongoing climate talks, oil was the most contentious topic during the meeting held in Belem. At the time, Lula faced protests by Indigenous groups and environmentalists against Petrobras’ plans to explore for oil near the mouth of the Amazon River.

Petrobras did not respond to AP’s written request for comment on its plans for the mouth of Amazon and on energy transition. Lula’s office also did not respond to a request for comment.

Environmentalists say they hope Lula can be convinced to change policies by 2025, when Brazil is expected to host COP30 in Belem. Whatever the next years bring, at the moment the administration is marching ahead.

“We will not be ashamed of Petrobras,” Brazil’s minister of mines and energy, Alexandre Silveira told daily newspaper O Estado de S. Paulo in an interview this week. “We will not be ashamed of also having the potential of fossil fuels in Brazil. They need to be explored because Brazil is a country in which social injustices and prevalent.”

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Maisonnave reported from Brasilia, Brazil.

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