No, we aren't going to run out of oil. But someday they won't be able to give it away, except for petrochemicals. So when will demand start to collapse? And what will happen to markets when oil craters, because nobody will be willing to cut supply first? And what about the rest of the economy? And the world entire?
My take first, from two years ago: Peak Gasoline Looming Out of Smog in India, China
As usual, this sort of thing is in the financial and trade press, but not the MSM. I haven’t heard it from any of our Presidential candidates either. They do talk about the demise of coal, but not oil and gas.
We have mentioned electric cars, including electric police cars and taxis, along with garbage trucks, buses, and trucks. In other words, the end of the ICE age.
Let's begin with some relatively mild Denialists who are trying to hold on as long as possible.
Vitol warns oil demand to peak within 15 years—OilPrice.com
Vitol sees peak demand in 15 years. The world’s largest oil trader, Vitol, sees oil demand peaking within 15 years. “We anticipate that oil demand will continue to grow for the next 15 years, even with a marked increase in the sales of electric vehicles,” Russell Hardy, Vitol’s chief executive, said, according to the FT. “But that demand growth will begin to be impacted thereafter.” Vitol is reportedly looking at investments in cleaner fuels and other forms of renewable energy.
Yeah, not sticking with investments in buggy whips. Good idea, except that it won't be even that long.
There have been predictions of Peak Oil for decades, based on depletion of known reserves. So far, technology has advanced to provide new resources even faster. Deeper drilling. Drilling in the oceans. Angled drilling. Fracking. Extracting more oil from existing wells.
Now the issue is not the limits of supply, but decrease in demand.
EV Revolution Could Wipe Out $21 Trillion In Oil Revenue
As a result of the advent of EVs, crude oil demand will peak long before 2040, in the mid-2020s. By 2040, oil prices will have fallen to US$32. Coal will be doing even worse, with a ton selling for just US$28 thanks to the increased use of low-carbon power generation capacity replacing coal power plants.
Here you go. Efficiency, conservation, and EVs.
The Rapid Acceleration Towards Peak Oil Demand
To be clear, the developed world passed peak oil demand a decade ago and has for years been forecast to continue reducing its demand. Increasing demand in industrializing countries, particularly China and India, each with a population tantamount to that of the OECD, slightly overpowers declines in the developed world, and as a result, global demand continues to increase. In its 2015 World Energy Outlook, the IEA forecast 1.5% y/y increase outside the OECD, -1.2% y/y in the OECD, and an overall growth of 0.5%. Global peak demand will likely occur while developing world demand is still growing. Increased decline in the first world could crest demand, but merely slowing the growth in the rest of the world is the more likely to tip the global balance to plateau then decline.
When the IEA released its 2015 World Energy Outlook mentioned above, not a country on the planet had stated plans to ban new sales of oil-fueled cars. Only Japan and Portugal had even created incentives for electric vehicles. In 2016, three European countries outlined plans to end sales of new gasoline and diesel engines. Before the year was over, IEA revised its OECD forecast downward to -1.3% per year.
In 2017 a rash of targets to constrain fossil fuels for cars led Forbes to declare it to be “The Year Europe Got Serious about Killing the Internal Combustion Engine.” In 2018, even more European countries have joined the list, stating their intent to end the sale of new petroleum vehicles at some point between 2030 to 2040. Also this year, the trend has expanded out of Europe to Israel, Costa Rica, and Taiwan, with targets as early as 2021. Over the same three years, 2016 to present, 20 metropolitan areas from these and other countries announced their own plans to end the use (not just sale) of gasoline and/or diesel vehicles, and mostly before or by 2030.
Nov 25, 2019 - The issue of "peak oil" has been talked about ever since the 1950s, when the late Royal Dutch Shell geologist M. King Hubbert predicted US oil ...
The peak oil theory is often confused with the concept of oil depletion, which predicts the gradual decline of oil in a well or geological formation.
Peak Oil Definition - Investopedia
… Overall, we can say that, even though the role of non-conventional oil sources was not correctly evaluated and the date of the peak missed at the global level, the Hubbert theory produced correct predictions and, in general, a valuable warning of difficulties to come. So, there never were compelling reasons based on historical data to dismiss the peak oil idea as wrong or untenable. Nevertheless, this is what happened.
Oil demand to peak in three years, says energy adviser DNV—Reuters
Sep 10, 2019 - OSLO (Reuters) - Global oil demand will peak in three years, plateau until around 2030 and then decline sharply, energy adviser DNV GL said in one of the most aggressive forecasts yet for peak oil.
Most oil companies expect demand to peak between the late 2020s and the 2040s. The International Energy Agency (IEA), which advises Western economies on energy policy, does not expect a peak before 2040, with rising petrochemicals and aviation demand more than offsetting declining oil demand for road transportation.
Wednesday’s annual report from DNV GL, which operates in more than 100 countries and advises both oil and renewable energy companies, would appear to be at odds with ongoing investment in developing new oil and gas fields.
“The main reason for forecasting peak oil demand in the early 2020s is our strong belief in the uptake of electric vehicles, as well as a less bullish belief in the growth of petrochemicals,” Sverre Alvik, head of DNV GL’s Energy Transition Outlook (ETO), said in an email to Reuters.
While DNV GL’s latest forecast shows oil demand peaking in 2022, one year sooner than it estimated last year, the difference is marginal and demand is expected to remain relatively flat over the 2020-2028 period, Alvik added.