In order to identify and assess the tools it may take to dismantle a corporation like Shell, we first need a good understanding of how the company operates in the context of the global political economy. What tactics have helped Shell to become the powerful oil and gas major it is today and which ones is it likely to pursue in future?

Looking at the oil and gas sector at large we see that Europe’s listed oil companies lost a total of €360bn in market value and Shell has nursed an incredible 60% decline in market value in 2020. How has this changed in 2021? Is this the metric by which Shell and the larger fossil fuel sector measure their performance? What do the coming years hold for Shell, and how does this inform the tactics we use to unravel their power?

Future Beyond Shell
Introduction: The State of Shell

Over the past two years, the fossil fuel sector has received massive bailouts due to the COVID pandemic. The Bank of England bought debt from Shell as part of its COVID stimulus program and the company was able to buy cheap bonds from the European Central Bank as part of the bank’s Pandemic Emergency Purchase Program (PEPP). Shell received this financial support on top of ongoing subsidies from Dutch, British and other governments, and continues to lobby these governments for favorable policies. Why do we keep supporting the corporations that are pushing us to the brink of climate collapse and what does it tell us about the power that these corporations hold?

Our guest for this episode is Dr. Rhodante Ahlers, a researcher in the area of social, ecological and technological interactions. She co-authored the report ‘Still Playing the Shell Game’ as part of the Future Beyond Shell project.

Show Notes

Future Beyond Shell report ‘Still Playing the Shell Game’:

Two major benchmarks of oil prices: Brent oil prices:

Western Texas Intermediate oil prices:

Shell’s current market capitalization:

Shell’s lobbying on the new Gazprom pipeline Nord Stream 2, which will go from Russia to Western Europe:

Original Dutch-language article:

Dutch government paid ‘compensation’ to Shell and Exxon for closing the gasfields in Groningen, to the tune of 90 million euros (Dutch language):

Corporate Europe Observatory on lobbying practices at the EU level :

Dutch advertising watchdog rules that Shell’s advertising falsely promotes its fuels as ‘carbon-neutral’:

Dutch government grants 2.4 billion in subsidies to Shell and Exxon for carbon capture and storage project:


MS: Today we have with us senior researcher Rhodante Ahlers. She holds a PhD from Cornell University in International Planning and her work specialises in interdisciplinary research into social, ecological and technological interactions. Rhodante served as a senior lecturer in Water Governance and Politics at UNESCO-IHE (Institute for Water Education) in the Netherlands. Her most recent work focuses on energy and infrastructure development and aims to reveal pressure points for achieving social and environmental justice. In the context of the Future Beyond Shell project she co-authored the report ‘Still Playing the Shell Game’.

Rhodante, thank you so much for joining us today!

R: Thank you for inviting me.

A: Also a warm welcome from my side, Rhodante. So our first question is just about the state of the fossil fuel sector and of Shell at large, what is their economic performance like? How are they doing?

R: Well, I think it’s really hard to sort of give an easy answer to this question. We see that over the past two years, things have changed tremendously. Last year, oil price dropped dramatically and now it’s just soaring, and so is the gas price. And we’re talking about scarcity, and all of a sudden, we need the fossil fuel sector. So I’m going to try and answer as best as I can and most of my answers are based on the report ‘Still playing the Shell game’, which we wrote with a bunch of people, a bunch of activists and researchers from different organizations. So I’m basing this a little on that research. But of course, I have my own opinion. So they are not responsible for my statements, of course. But yeah, today we’ve been seeing these last months, the oil and gas prices steadily increasing and this whole debate about increasing scarcity and the need for fossil fuels, oh oh oh, and so the sector’s becoming yet again, a little bit more popular. And we see this whole thing that happened last year, sort of fading away. And for Shell itself, we see that production is up, they have increased their dividends, they’ve actually reduced their debt a little and their market capitalization has increased to 190 billion US dollars. I think that was in September. Last year, it was 134. So it is increasing. So Shell is doing quite well for Shell’s bottom line goal: purposely and profitably do business to generate shareholder value”. For them I think things are going quite well, actually. So I think for the sector itself is going well but this is not all of the sector and I think COVID has had some impact in particular parts of the sector. So I think last year has brought changes within this sector, but we can talk about that.

A: Sure, thanks Rhodante. So you’re making this comparison a little bit of the past few months or the past year as compared to the COVID pandemic and the start of that. So I’m wondering how the sector fared during the COVID pandemic and any thoughts on Shell in particular?

R: Yeah, we saw last year that the price of oil plummeted and Brent went very, very low, Brent oil price, but the Western Texas, WTI it’s called, even went negative and so this was all linked to COVID. And we argued in the report that that is not correct, that things have not been going so well beforehand and that market price is never something that naturally happens because of circumstance but that market price is constructed. Some work by Anna Zalik at York University on oil futures and how market price comes about is really helpful. But we saw last year, in the first few months of 2020, Brent oil crude price plummeted not because of COVID but because Saudi Arabia and Russia decided to open up production and not hold to the OPEC rules of restraining production to restrain the amount of oil on the market. So the market was flushed with oil and the price went down. And of course it’s very easy for Price Waterhouse Coopers and McKenzie to link that to COVID but this had nothing to do with COVID. No it had to do with the way the producers between themselves are trying to make a stake for the market. It also has to do, we think, with the strategies of the oil and gas sector of the past 20 years, and in particular their financial strategy. It is in the first two decades of the 21st century, Shell, for example, could have chosen to spend the $237 billion that went to shareholders or to buy shares back to making fixed capital stock, more climate proof, or more social. Instead, it has accrued a lot of debt. It relies on a lot of potential stranded assets and actually cut 9000 jobs. So every euro they spend on these exorbitant payouts to executives and shareholders, or even shift to tax havens, they did not spend on sustainable or fair or decent jobs that would allow workers to fare through something as a COVID pandemic, or that would stabilize an oil market price, or that would take us away from oil, but into other sources of energy. So I think that this financial strategy of decades has also led to an oil sector that is just really not prepared for a transition to a healthy community or ecosystem. And when there’s a crisis, that is not really their problem.

A: Yeah, so is it fair to say over the past number of decades that Shell’s performance, and maybe the fossil fuel sectors at large has been sort of tenuous or mixed at best? Because in the report, you do characterize this sort of downward trend in terms of oil prices but also increasing debt. So their performance is not going well, even if the past couple of months say, has been they’ve been doing better?

R: But I think the shareholder says their performance is just fine because they have been able to increase dividends. And because this is their primary sort of goal, to generate shareholder value, I think, if they are examined on that, they’re doing all right. Of course, if we examine on how they pay their employees or the kind of subcontracting projects they have, then we have a whole different picture. Or how they deal with communities that have suffered pollution or any of that, we see a different story. Yeah, so I think in Shell’s own perspective it is doing alright. I think one sector that has really suffered from COVID is the shale production sector, because it’s a very, very expensive way of producing oil and they need that oil price to be high to please the, how they’re financed. So some of these companies have gone broke and some of the banks that financed them are also struggling. And this, of course, could happen to all of the oil and gas related assets in the future.

MS: Yeah, you’ve already started talking a little bit about the sort of tactics you have analyzed in the report. And I’m curious if you could maybe elaborate a bit more on a couple of these tactics that you think are really central to why Shell has become this powerful corporation it is today. But also maybe based on that I’m curious to hear if you can do a prognosis, what you expect from Shell in the upcoming months, years to do. How will they try to stay alive?

R: In the report, we identified four obstacles that prevent Shell from participating towards a meaningful just energy transition and we identified the first one is the focus on profit maximization as a capitalist company in a capitalist system. The second one, the use of inequality and ecosystem degradation to produce cheaply and sell expensively and make profit. And third, how they undermine democracy by using lobbying, revolving doors, even allegations of corruption. And the first fourth one is the way they tell their story and the way they project the future of the sector. And I can go into each of them. I think we also need to also understand that we live in a society that’s very, very dependent on very high consumption of energy. And its very, very unequal and destructive production and distribution. And this has allowed Shell to develop these tactics, increase debt, pay their shareholders, and do this destruction because we’ve not been able, and I’m not sure who the we is at this point, but they’ve been able to get away with murder, literally, also historically, colonially. And they’ve not had to pay for it. I think in the future, they are not going to really deviate very much from these tactics, because these tactics have served them well. And their shareholders are still supporting them but they’re also still supported politically. But of course, they work very hard at pleasing these two groups and as we’ve shown in the report, their importance of keeping dividends high. Now as soon as they’re making some money in 2021, the first thing they do is increase dividends. So they want these shareholders to be happy with them, and buying back shares, so that there are less shares in the market, so that dividends can be higher per share. And I think the second thing is, we see them cutting 9000 jobs last year during COVID. So we don’t really see them caring much more for good jobs or good wages or decent wages. We see them selling off assets, rather than cleaning up their assets, or decommissioning them. So I don’t see them changing their tactics so much and I think this is all possible because of what we’ve identified as undermining democracy, is because their business model is very much built on their connection within politics, and having these revolving doors of people who worked with them. This is certainly very clearly the case in the Netherlands and it’d be nice research to see to what extent that is the case elsewhere. We did not do that research, but we did it for the Netherlands and you see the revolving doors of very, very high placed politicians, ministers, foreign Affairs. We recently had the situation with our Minister of Foreign Affairs Sigrid Kaag, who has been supporting the whole gas pipeline from Russia, because Shell, of course, is a very, very close partner of Gazprom. So there’s Dutch, European support for this gas line. As for as for the revolving doors, the revolving doors doesn’t only allow them to, for example, influence local policy, but also European policy and regulation. It also allows them to influence policies around taxation. But it also allows them to keep investment agreements in place, such as the Energy Charter, which has been very, very important for the oil and gas sector. Certainly in the future, if climate adaptation policy implies that gas companies have to give up projects, and then using this Energy Charter Treaty, they can actually get compensation. This is currently going on. It’s also the route that has enabled Exxon and Shell to get 90 million compensations for revenue lost for the Groningen gas projects. And they have secured that 90 million compensation, while of course, households in Groningen who have suffered damage have not all secured their compensation. So they have been very successful in doing this. And they’ll keep on investing in those revolving doors. I think also in terms of lobbying, they’ve been very successful in lobbying at the EU level and we see that newspapers like Le Monde, but also the organization, Corporate Europe Observatory, did some really nice work fabout the amount of euros that go into investing into the lobbying of policy regulation at the EU level. And similar work has been done in the US as well. And I think the other tactic that they need more work on, and they used to be really good at, but lately has been failing a little is of what we called our fourth obstacle of their storytelling, their ways of presenting the world in the future through the scenarios, and the way they do their marketing and in their advertising. And you see now that the sector is trying to sort of rebrand itself away from fossil and energy towards power, powering people, which is supposed to sound very constructive. But of course, Shell has lately not been very successful in that greenwashing. So recently in August, the Dutch advertising regulator, the Reclame Code commission, has judged that their advertising is misleading and this concerned an advertising campaign that Shell had that if the customer paid a cent extra, they would be driving CO2 neutral, which, of course is ridiculous. But anyway, they were able to run that campaign for quite a while and only because citizens take action and take them to the regulator, is this being stopped. So I think they’re going to spend much more energy in sort of rebranding and advertising. And you see that in their budgets, that their marketing and advertising budget is increasing. So I think they’re going to be going towards that tactic. They do also still seek subsidies. They have secured, Shell and Exxon Mobil secured a 2.4 billion euros subsidy from the Dutch government to develop carbon capture and storage facilities. So this is their tactic. Their tactic, I think, is to seek technological funding or finance or development for technological solutions towards net zero rather than towards zero emissions. So to carbon capture storage, and from grey to green hydrogen, gas, of course, these sort of false solutions to the whole climate change issue. So I think that they’re going to continue that tactic and I think they’re going to be very successful in it. I think they’re probably currently very busy trying to get Green Deal finance. But in the meantime, they are producing, they are still producing and they’re also shifting a little bit, or they have shifted considerably from oil to gas, and they shifted from oil production to oil marketing, so oil trading. But you see that they are still producing gas, they are still into production and they are still very much into fossil fuels. That is their main business and they’ve shifted a little to renewables, but it’s insignificant in relation to their fossil fuel projects.

MS: Yeah, I think for me hearing and learning more about how many subsidies the oil and gas industry is receiving, how much public money is being invested to support these corporations that I think are not really serving us in solving or overcoming the climate crisis is very confronting. There has been one report published by Oil Change International, amongst others, that is saying globally governments spend more than 500 billion on subsidies for fossil fuels. And in the onset of the corona pandemic, of course, many governments issued bailouts related to the pandemic for fossil fuel corporations, and I felt there was very little discussion, or at least in the Netherlands, about whether this should happen, or not. I know not Shell but KLM received a bailout from the Dutch government and I’m curious to hear more from you how you see this? Should we continue with this pattern of bailing out these corporations? Are there any, like positives about this? Because often, it’s also said, Yeah, at this point, we are still to a certain extent, reliant on the services of Shell, etc. So I’m curious to hear what your thoughts are on this?

R: Well, I think your point about the positive bailout, I mean, the fact that they got this 2.4 billion subsidy for this carbon capture storage, it will take place in the port of Rotterdam, and the port of Rotterdam is a central, central driver of the Dutch economy. So this is how they sell it, you know, if you want the Dutch economy to be thriving, you need to invest in the sectors that are making it run and that is for a big part, well, Tata Steal, or the port of Rotterdam. It is these companies that are not exactly contributing to a future that is more environmentally or human friendly. So the economy is used. I think the amount of subsidies that are actually going to these companies is unclear. And bailouts in terms of Shell oil and gas, I’m not sure. But I do know that the European Bank and the UK bank, and the Dutch bank did provide corporate bonds. So very, very cheap money that these companies and certainly Shell used to have cheap debt. So they were able to borrow a lot of money for very little under the notion of COVID or under the notion of the sector needing to be propped up. And I really don’t think this is a good idea at all.

A: So there’s no redeeming aspects to these subsidies or these bailouts at all. Is that, is that correct? Do you think?

R: No, I don’t. Personally, I don’t think so. I think you could make an argument for subsidies that are strictly controlled, and very strictly geared to particular issues, for example, re educating or re schooling the workforce away from coal, oil and gas towards a future for them in which they can find jobs in new sectors or in renewable sectors or something, or subsidies that help decommission oil and gas installations. But also under very strict regulation that this compensates and cleans up. And that of course, it cannot go hand in hand with dividend increases or exorbitant salaries for executive management. So that you have to put in conditions like the wage differential cannot be more than, I don’t know what’s fair, 1:10, 1:1, whatever. So I think it’s really I think the only way you could possibly do it is very strict and controlled targets. But I really think you should spend your money on restructuring something like Shell into sort of public utility or spend your money, maybe as a start, I don’t know in re schooling, the workforce and giving them a future beyond fossil fuels. In supporting communities to produce and organize their own power to also increase education on sacrifice zones, and how to stop creating more sacrifice zones, and compensate the sacrifice zones out there, and connect people to the sacrifices zones knowing that their energy consumption is linked to degradating lithium expenses in Argentina because they’re driving an electric car. I think that’s where finance and public funding should go to repair, to recover, to reconstruct towards a future that is not only good for the Ben van Beurdens of this world.

A: Exactly. I’m wondering do you expect more of these bailouts despite the fact that I think we can agree that they serve only the sort of CEO or the C suite of companies like Shell at the expense of most of the population and our environment? Do you expect more bailouts for the oil industry in the near future?

R: Yes, I do. Because I think unfortunately, the whole banking system, there is a wonderfully depressing, but well written report by the French, called the Green Swan and it explains exactly how the whole banking sector or financial sector is sort of implicated in the oil and gas industry, in the energy industry. Energy being so basic to everything we do and us being so addicted to it, our society and particular sections of our society, which is very clear right now. I mean, now they’re talking about energy poverty because of scarcity. I mean, we were talking about energy poverty years ago and nobody listened. But because we’re so hooked on this stuff, I guess, and the financial industry is so implicated, if we are not able to structurally change anything, the political system will continue to bail out the sector. Because it’s financially dependent. It’s the financial sector hinges upon it. For a large extent, not completely, but for a large extent. Or, I think maybe some of the funding should go there, or some of the attention should go to how do you de-link that and how do you move away from Shell recently selling a lot of assets. And rather than selling them decommissioning them, and how do you do that without them bringing down economies? I mean, I think Nigeria, for example, started a whole discussion about diversification of their economy, because they really, really suffered last year, with the low oil prices and being so dependent on them. But I’m just hoping that this increase in oil price right now, doesn’t sort of give everybody this idea like, oh, you know, it was just a hitch?

A: Yeah, it’s a feature of the system, not just a temporary bug. So you mentioned a little bit this idea of diversification and the need to decommission, instead of fossil fuel infrastructure assets that Shell has, as opposed to pumping more money into the company. Could you build on that a little bit? What would putting a stop to subsidies or bailouts mean for Shell’s future? You know, what would a halt in public funding mean for a company like Shell?

R: If they would lose political support for their… I think it would be an interesting research to see to what extent that investment that Shell does to lobby if that isn’t as much as they get through bailouts and subsidies. I’m not sure, that’s a bold statement. But I wonder. I think, of course, another big issue of subsidies is taxation and the way they’ve been able to avoid paying taxes and using profit shifting and tax havens and, of course, that’s a big thing. So making them start to pay the taxes that are due that they should pay would be a beginning. Would it break them financially? I don’t know, I find that really hard to say. I’m not sure if they are that dependent on the bailout and subsidies. I think they are dependent on politicians preventing a real change to the system. I think the revolving doors and the lobbies and, you know, the surplus extraction from workers and environment is what they finally thrive on more. So stopping that, making them pay fair wages, having them pay taxes, having them follow the rules and regulations of a democratic fair system. I think that would make their business model a bit more complicated and jeopardize it more.

A: Definitely. I have just one question in terms of putting Shell and the fossil fuel sector and their subsidies, bailouts and relationships to to governments in an international perspective? Is it the case that many governments or most governments around the world have these ties? Or are these relationships between fossil fuel corporations and governments, particularly strong in particular parts of the world?

R: Yeah, I think so. If we look at the history of the 20th century, we see a very particular history of the fossil industry. We see countries like Mexico, and you know, Mexico, for example, in the 1930s, having their own oil, were able to build a democratic system within a social and private sector system, using their oil revenues. But at the same time, the unequal relations between the Global North and the South, of course, led to the oil crisis in the 1970s, and also created the huge debt relations that many of these countries have had. So I think the fossil fuel industry has dramatically impacted development globally. And the way that the Global North has been able to extract and exploit resources in the Global South, yeah, I think that’s a global phenomenon and very much linked to colonial practices, apartheid and environmental racism, made all of that very possible. And still today, I think we see it happening again, in the sacrifice zones for lithium, and also the Western Sahara for solar and wind energy. So, yeah, this is also part of the system.

MS: Yeah, as I think one of the last questions that we have for you today, Rhodante, I would like to hear a little bit more, of course, this podcast and the upcoming episodes will be all about investigating how we can dismantle Shell and I would like to hear from you maybe based also on the future scenarios you’ve sketched out beforehand -the tactics you think Shell is going to be reliant on in future- I would like to hear what you think will be needed to actually put an end to Shell and what the biggest hurdles might be?

R: I think the biggest hurdle is the way that energy has structured our lives to the extent that it has, and the way it still has, and how any change to that brings enormous resistance. Certainly by the powerful fossil industry, but also the political power behind it. And I don’t know, for example, when we shifted from coal to gas in the Netherlands, was done very, very quickly in the 1950s 60s. But it was also made possible because gas was cheaper and easier, and it burned better and it just made life easier. And this transition we have to make today isn’t necessarily one that is easier, or cheaper, and that brings about a lot of problems. That makes it hard to get a large collective around it and I think also a larger political acceptance around it. That’s one thing. And I think the resistance by the powers that be, remain enormous given the amount of bailouts during COVID, that went to companies and businesses and did not go to people communities, or health care, or education. I mean, the system is very skewed towards a particular economic system. So I think, to dismantle Shell also would need to dismantle that aspect of the system that prioritizes profit over people, I think. And so if there is a future Shell, we need to think about energy that is not a profit producing commodity, it shouldn’t be a commodity, it’s something that should be a public utility. So the Shells of the world should become public utilities. And whether that is worker run or community lead or public and municipal lead that’s to be seen. I just really, I’m sorry. I’m just really disappointed by and surprised maybe, by how we saw that during COVID, actually, air quality went up and we saw stuff was possible, and how easily that’s been forgotten.

MS:Thank you so much Rhodante for sharing all these insights. I really enjoyed particularly, yeah, you putting a finger on these political ties and this sort of political inertia that makes it possible really to hold these … for corporations like Shell to just continue doing what they’ve done for decades, for centuries. So thank you very much for that.