HAPPENING RIGHT NOW- COP28 has run into overtime: Countries remain at loggerheads over the wording of a draft agreement that circulated on Monday, kicking the conference into marathon negotiations on a final text that continued overnight.

A new draft agreement started making the rounds a bit after 5am KSA: Instead of a phase-out of oil and gas, it calls for “transitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner … so as to achieve net zero by 2050 in keeping with the science” with a “need for deep, rapid and sustained reductions in greenhouse gas emissions in line with 1.5C pathways.”

The language is wishy-washy: The agreement now “calls on” companies to make progress on goals including tripling renewable energy capacity, phasing down the “unabated” use of coal power, and “accelerating efforts globally towards net zero emission energy systems” (among others).

Sound smart: In UN-speak, “calls on” is the “‘weakest’ of all the various terms used for such exhortations,” writes Carbon Brief’s Leo Hickman. “In UNFCCC legal jargon, this is known to mean an ‘invitation’ or a ‘request.’”

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So where do we stand now? The fundamental question is whether the watered-down language is enough to get KSA on side — without alienating European Union countries and island nations.

In the first corner: Saudi Arabia leads a group of (mostly Arab) oil and gas producers that fiercely oppose the use of “phase out” or “phase down” in any final agreement. Saudi has signaled for more than a week now that it simply won’t sign an agreement that even hints at the end of hydrocarbons, which account for as much as 45% of its GDP.

In the other: The European Union and small island nations, who have variously called the Arab world’s stance “disgusting,” “deeply disappointing,” and “out-of-step.” Climate change is particularly existential for the island countries, who face the prospect of their nations sinking into seas and oceans.

Why it matters: A single “no” vote from the nearly 200 countries participating means there’s no agreement.

The kingmaker? Saudi Energy Minister Abdulaziz bin Salman arrived at the COP28 presidency last night in what observers think is a sign that talks are getting down to brass tacks.

Optimism? US climate envoy John Kerry before the release of the latest draft that he thinks talks are “moving in the right direction,” COP28 CEO Adnan Amin told Bloomberg that negotiators are on the “cusp of an agreement,” and Canada’s climate minister says the pact taking shape should “keep 1.5°C within reach.”

The timeline: The COP28 presidency has called for a plenary session in Dubai at 8:30am KSA.

How western business press sees it: COP28 heads for extra time as majority clashes withSaudi Arabia. (Financial Times)

WHAT CLIMATE CHANGE COULD MEAN HERE

Gulf Cooperation Countries could collectively lose about 8% of their GDP by 2050 on the back of extreme heat and water stress by 2050 if no further adaptation measures are taken, according to a report by S&P Global. Gulf economies are the third most-at-risk in the world given that our “economic geography” makes us highly exposed to climate change.

The silver lining: We have the resources to mitigate against it. Most GCC countries have the fiscal firepower resources to ramp-up investment in adaptation — though there is plenty of upside risk to the total cost of the adaptation bill.

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