Well, welcome ladies and gentlemen, and it's great to see you all here on day 2 of the Atlantic Council Global Energy Forum. I'm excited to have a short dialogue here with an innovative thinker, expert on geopolitics and how the world works. He happens also to be the CEO of Repsol, a major global oil and gas company, energy company, not only oil and gas but raw materials exploration, low carbon solutions, a whole gamut. Josu Imaz, thank you for being here, CEO of Repsol, really a pleasure to have you.
Thank you and thank you for having me here. It's a real honor for me.
So in preparing for this conversation, I was looking back to when you took over as CEO in 2014. And at that time, oil prices collapsed within 6 months of your tenure, your new tenure as an executive of this company. Russia invades Crimea. A lot of volatility in the world. And reflecting, you know, how things right now as we look at 10 years later, 2022, Russia's invasion of Ukraine, geopolitical strife in the Middle East. Volatility is a feature of this business. And I'm really interested to hear how you're thinking about what can be done to reduce that market volatility, but in the context of this, the United States over that decade have taken maybe separate, sometimes divergent paths, not exclusively. But what are we looking at in the landscape between the EU and the US and managing that volatility?
So first of all, let me say that volatility is part of this business. We don't invest for one year. We invest for 10, 20, 25 years. So we know that in the midst we are going to suffer this kind of ups and downs. That is part of our business. And for us, being in the states is a good decision. We are happy being here. We have invested almost 20 billion dollars over the last 20 years in the states; that for the dimension of our company is a huge amount of money. This year we are going to invest $2 billion in the US. And let me say we feel at home here in the US, not only because the business friendly environment because, and that is important to underline in these complex days, because we are part of the same community of values. We share the value of human rights, respect of democracy, balance of power, market friendly areas. Atlanticism and the concept of Atlantic Council for me represents all these kind of values. And on top of that, being here in the states is a good decision because you have a friendly country to invest here. Friendly because it's a large market, 330 million people is the largest global economy. On top of that, you have a market friendly orientation in all your policies, and that is very important for a company investing in the long term. The respect of rule of law, and being in the energy sector, you have a very important thing: you have an energy ambition to produce more energy, either molecules or electrons in the country. And you have a deregulation agenda and you respect the principle of technological neutrality with no biases. We need more energy. We need an energy transition, of course, but we need an energy transition based on technology and not based on ideology. And sometimes, I'm sad saying that in Europe we forgot the principle of the energy trilemma. We forgot the security of supply concept. And we built dependence on Russia and we risk to build dependence on China now regarding electric vehicle and some forms of mobility. We forgot the concept of affordability and we suffer in 2022, 2023, and European families suffer to pay the energy bills and our industry is suffering the energy cost. And I think that all that is important and has to be respected. My hope is that after the release of a Draghi report last summer, I think that is a clear claim that we have to take action and we need a radical change in European energy policies. Now we need leadership and we need speed. So the Draghi report obviously being the one on competitiveness and how Europe can respond.
To this world, which is increasingly difficult to operate and have business certainty. You're putting billions of dollars in the United States, but you didn't talk about billions of dollars in Europe. So I'm thinking about the opportunities and change in that report in particular that maybe enables Europe to be on the same footing for that scale of investment.
I mean, we are an integrated company. That means that we have our downstreaming business and we are a Spanish company, Iberian company, proud of being Spanish. And part of our activities is there. I mean, 60% of our capital employed is in Spain and Portugal, our refineries, our service stations, our retail power business and so on. And at 35%, that could be something close to a current 90% of the total investment is here in the US. So from the point of view of the EMP we are an American. And what we need in Europe to be more attractive because we are also a very large market when we take into account the European Union and the European common market, including the UK, Iceland, Norway, and so on. We are more than 500 million people, so we are a very large market. But we need mainly three things that are clearly described in the Draghi report. First, we need less regulation. We have too many directives, bills, laws, regulation and so on. And for the 60% of the European companies being over regulated is the main obstacle to invest in Europe. So I think that there is a clear message there. On top of that, you have the advantage of being a single market. We aim to be a single market, but we still have a lot of internal barriers in Europe and we have to overcome and erase these barriers. And there is another aspect that is very important in the report related to our sector: we have to respect the principle of technological neutrality. I mean, I always underline a point: you Americans saved Europe many times in the 20th century and sometimes with the blood and the life of your people to defend the freedom of Europeans. I can't forget that. But you also saved Europe in 2022. The American fracking saved the European energy system in 2022 and 2023. And it's a contradiction because in many European countries, fracking, including mine, is forbidden. Exploring and producing natural gas is forbidden in many European countries, including mine. And at the same time, we say to our friends, please, I need your gas. It's great. We love American gas. So we have contracts from the Gulf of America to supply our Spanish system. But I think that we need to be more coherent to boost and to enhance and to increase the investment in Europe.
So, you know, it's interesting hearing you draw out these specific elements of the Draghi report and then pivot to geopolitics because the competitive narratives, the competitiveness narrative has really kind of been overtaken by events. And there's two things about that. One, of course, you have the ongoing invasion in Ukraine and European energy security. And now you have a crisis in the Middle East. And then you compound that with a thematic of this forum this week, which has been this surging aspect of energy demand from AI and features that are reshaping the energy system again. How should we be thinking about energy security in this context?
