Dubai, United Arab Emirates - Negotiators released the first draft of a UN agreement on climate action Friday calling for fossil fuels to be reduced or eliminated, setting up a fierce fight at the COP28 talks in oil-rich UAE.

Divisions over the future of fossil fuels have already surfaced at the COP28 talks and proposals for their "phasedown/out" contained in the draft prepared by the UK and Singapore will be highly contentious.

Calls for the inclusion of explicit curbs on coal, oil, and gas in a final agreement have gained momentum, but any effort to limit fossil fuel use will encounter strong opposition.

Over the next two weeks in Dubai, representatives from nearly 200 nations will haggle over the draft details in the hope of adopting a final resolution to limit planet-heating emissions.

Observers say debate over the terms "phaseout" and "phasedown" will follow, but the inclusion of such language at the outset of COP28 was significant.

"It is more ambitious than anything ever tabled at COP27, so even having it among the options is a big step up," said Lola Vallejo, an expert from French climate think tank IDDRI.

The draft, which proposes a reduction or phaseout of coal or "no new coal," forms the basis of negotiations.

It is a formal response to the "global stocktake," a damning report card published in September that highlighted how little the world had done to confront the climate crisis.

Friederike Roder from Global Citizen, an NGO, said the draft language did not go far enough.

The text "should clearly call for a phaseout – not phasedown – of all fossil fuels. This must extend beyond coal and address the entire economy, not just the energy sector," she said.

The talks come at a critical time with 2023 on track to be the hottest year on record and emissions still rising.

On Thursday, UN climate chief Simon Stiell urged delegates in Dubai to "signal the terminal decline" of fossil fuels, which are the dominant contributor to global warming.

COP28 president Sultan Al Jaber – the head of UAE's national oil company – called on negotiators to "ensure the inclusion of the role of fossil fuels" in any final agreement.