Ben van Beurden, the chief executive of Shell, has endorsed warnings that the world’s fossil fuel reserves cannot be burned unless some way is found to capture their carbon emissions. The oil boss has also predicted that the global energy system will become “zero carbon” by the end of the century, with his group obtaining a “very, very large segment” of its earnings from renewable power.

And in an admission that the growing opposition to Shell’s controversial search for oil in the Arctic was putting increasing pressure on him, van Beurden admitted he had gone on a “personal journey” to justify the decision to drill.

The Shell boss said he accepted the general premise contained in independent studies that have concluded that dangerous levels of global warming above 2C will occur unless CO 2 is buried or reserves are kept in the ground. “We cannot burn all the hydrocarbon resources we have on the planet in an unmitigated way and not expect to have a CO 2 loading in the atmosphere that is often being linked to the 2C scenario,” he said in an exclusive interview with the Guardian.

“I am absolutely convinced that without a policy that will really enable and realise CCS (carbon capture and storage) on a large scale, we are not going to be able to stay within that CO 2 emission budget.”

The admission from the boss of the world’s second largest independently owned oil company comes as the fossil fuel sector comes under unprecedented public pressure to change its business strategy. Shell and BP have been forced to accept shareholder demands to be much more transparent about the impact of their activities on climate change issues at annual general meetings in recent weeks. And in the latest sign of sweeping changes, the energy minister of the world’s number one oil exporter, Saudi Arabia, admitted that his country could wean itself off fossil fuels completely within 25 years.

Van Beurden said Shell, along with “a majority of society”, acknowledged that climate change was a real and serious issue. He said it was highly undesirable that the world move beyond 2C. But he argued that talk of a “carbon bubble”, where a large portion of fossil fuel reserves were overvalued because they could not be used, was simplistic: it was necessary to differentiate between higher carbon assets such as coal and lower CO 2 ones such as gas.

And he said the fast rate of depletion of oil fields meant it was always necessary to find new reserves just to stand still. “All the oil that we have, we will use,” he insisted. “There will still be a need for hydrocarbons for years to come, and the decline in existing production is always going to be faster than the decline that the most successful [low carbon] policies can create. There is always going to be a need for investment.”

Some independent surveys have argued that 80% of coal reserves, 50% of gas and 30% of oil would need to be kept in the ground, with high-cost deepwater, Arctic and tar sands projects particularly singled out as likely to be “stranded”. Shell is heavily invested in all these areas and likely to be more so when it acquires its rival BG, for which it has made a $70bn (£45bn) agreed bid. But van Beurden denies that his company is therefore exposed to a carbon bubble.

He said some of the opposition to the planned oil exploration this summer in the Alaskan Arctic was emotional and difficult to engage with, but the decision was taken on rational grounds of assessing the technical risks. But the oil company boss admitted that there had been a lot of corporate and individual soul-searching, despite obtaining the go-ahead from the US authorities: “I had to go through a personal journey on that.”

Van Beurden reiterated his long-espoused view that there is a moral case in favour of fossil fuels because of the role they can play bringing energy to parts of the world that have not enjoyed the same benefits in the past as the west.

Shell is engaged in a number of CCS projects: one at Peterhead in Scotland and another designed to reduce carbon emissions at a tar sand project in Alberta, Canada. The company also claims to be one of the largest renewable energy companies in the world despite spending annually less than $1bn on green schemes out of a total $33bn capital expenditure budget.

Van Beurden insisted that he had his hands tied from investing more heavily in CCS because they would not produce the high financial returns that investors had been used to from oil and gas. “I would lose my job over it if I just threw a few billions away [on CCS] … CCS is essential for society and ... is ultimately important for our company, but listen, I have great difficulty to have shareholders focus on the quarter after next.”

But he said that the world would move to a zero-carbon energy system by the end of the century, with any fossil fuels having their carbon captured. He said already there were no technological difficulties to doing CCS, just legal, political and other impediments.

Van Beurden said renewables, and solar in particular, would become very important for Shell and the world post-2050. “We probably will be working on a very, very large segment of renewable energy,” he explained. “Is there an opportunity or obligation to invest in a low-carbon energy future? Absolutely, but I know that whatever I am going to find as a business model or a technology that will work for me will take decades to pull off. But we have been active participants in solar energy, in wind energy ... in many areas we have been ahead of our time,” he added.

The Shell boss justified the company’s continued involvement in climate denial lobby groups such as the American Legislative Exchange Council on the grounds that the company supported other aspects of its work. But he also signalled that Shell may withdraw its support by letting its membership lapse, saying they should “watch this space”.

British oil companies, plus Statoil of Norway and ENI of Italy, are trying to develop a proactive strategy amid fear that forthcoming UN climate change talks in Paris could come up with new policies that would restrict the way they operate. The Guardian’s Keep it in the Ground campaign seeks to persuade the Wellcome Trust and the Gates Foundation to divest themselves of their shareholdings in fossil fuel companies. According to the latest figures, Wellcome held a stake of £142m in Shell as of September 2014. The Gates Foundation held £6m of Shell’s shares at the time of its latest tax filing in 2013.

The Shell boss said divestment was a simplistic solution to a wider problem and could delay adopting more meaningful policy options: “I fundamentally do not believe that holds a business rationale.”

Van Beurden admitted that for all his concerns about climate change, he still drives a large BMW He explained it was an endorsement of his company’s core activities: “You’ve got to believe in the product.”

Note: This article was updated to clarify that Ben Van Beurden was not referring to both renewable energy and CCS when he said Shell could not invest more heavily because of investor pressure, but only CCS.