The fall in fossil-fuel prices offers governments a chance to offset the potentially massive public debt incurred by the COVID-19 pandemic. Large revenues could be raised by placing a global price on carbon while oil prices are low. For oil alone, a levy of US$30 per barrel on 100 million barrels per day would return $3 billion per day, or $1.1 trillion per year.

A consistent charge applied to all fossil-carbon emissions, irrespective of source, could return overall fossil-fuel prices to pre-pandemic levels in a simple, efficient and transparent way. As well as raising revenue, it would reduce uncertainty about energy prices, buffering against future price spikes and protecting investments in energy efficiency and renewable energy. The economic recovery from the pandemic would follow a low-carbon trajectory.

If world leaders act fast, using the same decisive and coordinated approach they have applied to combat the spread of the virus, they can help to protect both the economy and the climate through a single simple instrument.