Low hanging plumes

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The annual Global Methane Tracker from the International Energy Agency (IEA) presents the energy watchdog's latest estimates of methane emissions from the energy sector.

It reveals that oil and gas operations released 45 Mt and 36 Mt of methane respectively in 2025. A further 43 Mt of methane was emitted from the coal sector, while bioenergy contributed 20 Mt. In total, the IEA estimates that the energy sector released 124 Mt of methane into the atmosphere last year.

Importantly, the IEA conclude that there is "still no sign that methane emissions from fossil fuel operations are falling, despite well-known and proven mitigation pathways." More than 35 Mt could be avoided at no net cost, the agency estimates, based on average energy prices in 2025.

Energy industry commentators have talked about tackling these so-called "low-hanging fruit" for several years now: implementing leak detection and repair programs, installing vapour recovery units, replacing pumps and compressor seals, replacing existing devices with instrument air or electric motor systems, and so on.

In theory, the price of natural gas should be the most important factor determining whether or not companies are motivated to cut methane emissions. The higher the price of natural gas, the greater the incentive to plug any leaks, since any methane not lost to the atmosphere has a commercial value.

In reality, it doesn't quite work out that way, and it all comes down to opportunity costs and misaligned incentives.

Methane abatement might be a net benefit, but if another opportunity affords even greater returns, and for less risk, then that is what fossil fuel companies will prioritise. High energy prices are more likely to result in energy firms expanding production, rather than investing in cutting the methane emissions intensity of their existing production.

Meanwhile, the sectors most exposed to methane abatement pressure are not necessarily those with the most power or inclination to take action. For example, upstream activities account for 80% of oil and gas methane emissions; national oil companies (NOCs) such as Saudi Aramco and ADNOC account for around 50% of global production, yet are under far less pressure to cut methane emissions than the oil and gas majors (see No free lunch: Cutting global methane emissions from oil and gas is more difficult than it seems).

Add into the mix of potential benefits, the IEA's latest report also frames cutting methane emissions as an opportunity to improve energy security. Alas, this motivation also suffers from both opportunity costs and misaligned incentives.

Plugging leaks does nothing to release the LNG bottled up by Iran's stranglehold on the Strait of Hormuz, even if they could be fixed in swift order, which they can't. The timeline for mitigating the majority of the methane emissions is measured in several years or more, far beyond (we hope, dare I say) any disruption to supply. Lastly, the 80 Mt or so of oil and gas methane emissions are spread across the globe, and most of it will be located among the exporting countries – those least incentivised by importers energy security concerns.

Is there anything that could change the opportunity cost calculation, and put methane abatement on a level playing field with increased production, or at the very least moves it up the agenda? Is there any policy or market mechanism that can align incentives across the energy supply chains, ensuring that those concerned with methane emissions can push those who can make a difference to do so?