No chance oil and gas is phases out globally.

The world has failed to come to an agreement to stop burning fossil fuels. After two weeks of negotiations, a draft decision at the United Nations COP27 climate conference in Sharm El Sheikh, Egypt, promised a compensation fund for climate change damages but fell short of a push from the US and Europe for a “phase-down” of oil, gas and coal.

In fact, it’s worse than that. Although a phase-down of coal was agreed at last year’s Glasgow conference, other fossil fuels are going to remain immune. Twenty years from now, we are still likely to see global climate meetings failing to agree to a phase-down (let alone phase-out) of fossil fuels. And that’s OK — because what matters is not the words in an international agreement, but whether our carbon emissions are falling fast enough. On that front, the prospects are far better.

There’s a simple reason why getting consensus at UN climate meetings is so hard. The verbiage released at the end of COP meetings isn’t just words, but a quasi-legal text that serves to flesh out the binding commitments of the 2015 Paris Agreement. If just one of the 193 parties to that treaty objects to the conference decision, there will be no deal to announce. That’s why campaigners, fossil-fuel lobbyists and diplomats fight so hard over every emphasis. The COP decision isn’t exactly law, but it still influences the actions of governments and companies in the real world.

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As we lumber along the road to net zero, a significant number of UN members are getting uncomfortable about the destination. The Organization of Petroleum Exporting Countries numbers 13 states, with 11 more in the OPEC+ grouping. Throw in non-OPEC+ countries highly dependent on oil and gas — like Guyana, Qatar, and Turkmenistan — and you have as many as 50 delegations, depending on how you draw the line. For that group, equivalent to a quarter of UN member states, a commitment to phase out petroleum is a vow to shrink their own economies.

The situation with oil and gas is different from the one with coal. Heavy, messy, and expensive to transport, the solid fuel is far harder to trade than petroleum. Only half-a-dozen countries are major exporters. Hardly any count it as central to their economies, the way oil is to scores of nations. That makes it far easier to negotiate reductions.

For decades, the major cleavage in environmental talks has been between rich and poor nations. That division remained stable for so long because on one level economic development is simply a process of using more energy. At a time when fossil fuels were the only viable low-cost energy source around, a promise to reduce emissions was a pledge for poor countries to stay poor.

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What’s changed is the remarkable rise of renewable technologies that can compete with conventional energy on cost as well as environmental grounds. That’s shifted the split in climate talks away from the old rich-poor divide, to a new one between exporters and importers of fossil fuels. The move is best exemplified by last year’s net-zero promise from India, for many years the standard-bearer of emerging economies resistant to making such commitments until they could grow rich. Wealthy nations’ agreement this year to a loss and damage facility to compensate small and poor countries for climatic disasters is another sign of the new diplomatic alliances emerging. So was the ebullience of oil exporters in resisting any phase-down language.

In working out who will win in this fight between importers and exporters, it’s worth considering the options available to each group. If you’re a major petroleum exporter, there’s no viable alternative business out there. Oil has made your country rich. (For the likes of Saudi Arabia, it’s arguably made your country a country.) It’s such a dominant trade that rival industries have withered in its shadow — the phenomenon of Dutch Disease familiar to many commodity exporters.

The situation for importers is very different. What your population wants is affordable energy and food, along with the fruits of development it brings. For a century or so, fossil fuels have been the only way to provide that — but consumers don’t much care if their scooter is powered with oil or their air conditioner with gas, as long as it works and doesn’t cost too much.