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Electric Cars Could Cause Oil Market Disruption on Par With OPEC

The growth of battery-powered cars could be as disruptive to the oil market as the OPEC market-share war that triggered the price crash of 2014, potentially wiping hundreds of billions of dollars off the value from fossil fuel producers in the next decade.

About 2 million barrels a day of oil demand could be displaced by electric vehicles by 2025, equivalent in size to the oversupply that triggered the biggest oil industry downturn in a generation over the past three years, according to research from Imperial College London and the Carbon Tracker Initiative, a think tank, published Thursday. A similar 10 percent loss of market share caused the collapse of the U.S. coal mining industry and wiped more than a 100 billion euros ($108 billion) off the value of European utilities from 2008 to 2013, the report said.

Major oil companies are waking up to the potential disruption plug-in vehicles could have on their industry. BP Plc says electric vehicles, or EVs, could erase as much as 5 million barrels a day in the next 20 years, while analysts at Wood Mackenzie say they could erode as much as 10 percent of global gasoline demand over that time. Global oil demand could peak in as little as five years, according to Royal Dutch Shell Plc Chief Financial Officer Simon Henry.

By 2040 16 million barrels a day of oil demand could be displaced, rising to 25 million by 2050, a “stark contrast to the continuous growth in oil demand expected by industry,” according to the report. The impact on the oil industry could exceed price slump of 2014 to 2016 that “wiped hundreds of billions off capex,” Stefano Ambrogi, a spokesman for the Carbon Tracker Institute, said by e-mail.

The cost of EVs is already falling faster than previous forecasts and they could reach parity with conventional internal combustion vehicles by 2020, eventually saturating the passenger vehicle market by 2050, the report said.

EVs may take 19 to 21 percent of the road transport market by 2035, according to the researchers. That’s three times BP’s projection of 6 percent market share in 2035. By 2050, EVs would comprise 69 percent of the road-transport market, with oil-powered cars accounting for about 13 percent.

bloomberg



56 Comments on "Electric Cars Could Cause Oil Market Disruption on Par With OPEC"

  1. Davy on Thu, 2nd Feb 2017 11:05 am 

    “About 2 million barrels a day of oil demand could be displaced by electric vehicles by 2025, equivalent in size to the oversupply that triggered the biggest oil industry downturn in a generation over the past three years” So they are saying electric cars will be as disruptive as shale was. Maybe, but my opinion is PEV are going to fall flat on their face as a transition technology for the transportation segment much beyond those numbers. They are going to be transformative in some niche ways that is about it. It is too early to tell but considering the state of the global economy and other issues I just don’t see the growth they are predicting by 2040-2050. I will give you a prediction from 2040-2050: Our economy and population will resemble 1960. Try that on for size and see how it fits.

  2. rockman on Thu, 2nd Feb 2017 11:11 am 

    And I forgot to point out: in 2016 of the 82 million new vehicles added to the 1.2 BILLION ICE’s already on the road 98.5% were ICE’s. Electric vehicles ARE NOT decreasing the GHG footprint of transportation. It only decreased the expansion of ICE’s an insignificant amount. CC metrics with regards to fossil fueled transportation didn’t get better thanks to EV’s last year…it got worse by 80+ million ICE’s.

    And how fast might that dynamic change? By the estimates of the optimists at BP and Wood Mackenzie global gasoline MIGHT decrease 0.5% per year. And that estimate was developed when oil was much more expensive. Consider that at the end of 2016 US light truck sales reached the highest annual rate ever recorded…more the 10 MILLION per year. Compare that to the total US plug-in sales for 2016 from “Inside EV’s”: 159,000. IOW US EV sales in 2016 was only 1.6% of just US pick up sales and not all US ICE’s sales.

  3. penury on Thu, 2nd Feb 2017 11:15 am 

    EVs might do something, or EVs may do something else, or perhaps EVs will do nothing at all. As has been said by others, how many vehicles will EVs replace by 2050? Not how many will there be in addition to the fossil fuel cars, but how many of the current vehicles will be replaced by EVs?

  4. Plantagenet on Thu, 2nd Feb 2017 12:05 pm 

    I don’t think anyone knows what the world will be like 20 years from now.

    It would be nice if everyone was buzzing around in an EV, but I could also see the EV market running into problems with things like finding an adequate lithium supply.

    Cheers!

  5. dave thompson on Thu, 2nd Feb 2017 12:53 pm 

    The battery life and replacement cost are an essential part of this conversation. If I keep my used S10 for twenty years or more or start over with an EV for twenty years which one has the higher cost and impact on the environment? If you get about 5-7 years per battery pack that would be at least two replacements over twenty years. At an estimated cost of $5,000-6,000 plus the cost to recycle. $10,000-12,000 buys a lot of gas. I don’t know wwhat the answer is.

  6. Davy on Thu, 2nd Feb 2017 1:23 pm 

    Dave, I have often made this point about unrenewable renewables that the techno greens are so hot to trot about. We need to consider the current useful life cost of existing infrastructure and rolling stock. The talk of an energy transformation is talking about creating a whole new civilization’s infrastructure. We need to consider with some of this potential buildout if it makes more sense to use what has already been built until it is worn out. We need a long hard look at cost benefit of existing systems in relation to new systems. Today the motivation is replace everything just because it is fossil fuel related and the idea is this new equipment will be cleaner. Not only can we afford this mentality but also is it really cleaner. What about the manufacturing process in relation to using what is there through its useful life? Replace some not all. Is there a better way to phase out all fossil fuels? I personally don’t think we will ever transition away from fossil fuels into an unrenewable renewable world. Since we know techno optimist and their business interest will try then we need to ask how much should we do and when?

  7. peakyeast on Thu, 2nd Feb 2017 2:35 pm 

    With current battery technology I doubt that EVs will become popular. It becomming increasingly evident that once an EV has a dead battery its value falls to a tiny fraction. And there are some stinking carcasses already lying at the roadside with near zero value.

    A separate or combined improvement on battery with about a factor 10 on power/$/year would bring it in a competitive position. With a factor of 20 they will take over everything.

    So still some ways off, but getting there.

    The question will be scalability and availability of resources that has to do the actual transition.

  8. Anonymous on Thu, 2nd Feb 2017 2:40 pm 

    EVs require OIL for their manufacture, distribution, sales, service, disposal, and for the infrastructure they need to operate, ya know…roads, parkades, tow-trucks, that stuff. IF, we are going to be stuck in all EV traffic jams any day now, or so thinks jewberg, then the demand for oil required to keep this wonderful all-EV world motoring along, will be significant.

  9. Davy on Thu, 2nd Feb 2017 2:47 pm 

    “The question will be scalability and availability of resources that has to do the actual transition.” And that requires a healthy growing economy. We do not have that nor does the future look bright for one. Maybe it will be enough but that is not a known yet. All this is pointing to the possibility of something less than a transition but maybe a transformation of sorts. In any case it is an important technology segment that offers society increased resilience and sustainability. Diversity is always advisable to having only one system. What needs to be watched for is that poor investments are not made with the idea there will be a transition because that is the official narrative.

  10. JN2 on Thu, 2nd Feb 2017 3:05 pm 

    Rockman, Davy, you might enjoy the optimism of Tony Seba’s book:

    “Clean Disruption of Energy and Transportation: How Silicon Valley Will Make Oil, Nuclear, Natural Gas, Coal, Electric Utilities and Conventional Cars Obsolete by 2030”

    Video here: http://bit.ly/2k0FFcU

    Easter Parade, New York 1900. Where’s the car? Same street, 1913, where’s the horse?

  11. Boat on Thu, 2nd Feb 2017 3:33 pm 

    The post seems optimistic. Parity by 2020 means what, a $30,000 car or truck or does parity mean a $5,000 used car the average joe can afford. To replace FF vehicles the price has to drop much farther than the post implies. Today you can buy a $2,000 FF car and still run it a few years with a few repairs.

  12. dave thompson on Thu, 2nd Feb 2017 3:34 pm 

    JN2, the part missing from the narrative in the video is the fact that all of our current and past technological breakthroughs have come about by the burning of fossil fuels. EV, solar, wind, silicon valley, are all based on burning FF.

  13. JN2 on Thu, 2nd Feb 2017 4:00 pm 

    >> all of our current and past technological breakthroughs have come about by the burning of fossil fuels <<

    True. But that was then and this is now. MGM just paid $87M to Nevada Power to leave the grid and use solar instead.

  14. pointer on Thu, 2nd Feb 2017 4:02 pm 

    We could eliminate millions of barrels of demand immediately simply by boycotting driving. No need to build or buy EV’s.

    Considering the current occupant of the White House seems to be intent on picking fights to start wars possibly for the purpose of “another chance” to take certain oil from the Mideast, we might be well advised to engage in this boycott as soon as possible.

  15. dave thompson on Thu, 2nd Feb 2017 4:11 pm 

    “True. But that was then and this is now. MGM just paid $87M to Nevada Power to leave the grid and use solar instead.” JN2 you have then made my point, solar exists only because of the industrial process driven by burning FF. Solar, wind, and all of the so called alternatives come about on the continuing ride of the burning of FF. When we have the building of solar panels, from mining to installation, based on solar power inputs alone I will be impressed.

  16. Davy on Thu, 2nd Feb 2017 4:17 pm 

    Pointer, wwwhat was your sweetie Obama doing? Are you just now waking up? Man, there are some wingdingsers in orbit around here. I hope Trump screws the world up becuase our site space cadets deserve it.

  17. Davy on Thu, 2nd Feb 2017 4:21 pm 

    Right Dave, they have not impressed me. Too much fake news and corruption in this world. Our techno greens are stretching the truth becuase it feels good. I would love for it to be true like so many other hopes like world peace and a healing nature.

  18. makati1 on Thu, 2nd Feb 2017 5:23 pm 

    Depletion is going to affect OPEC much more than a few million “possible” vehicles. lol

  19. twocats on Thu, 2nd Feb 2017 7:09 pm 

    a key part of the article makes it sound like the massive demand destruction that occurred after GC of 2008 is something that was not done out of sheer economic necessity and that it can be reproduced (perhaps multiple times?!) and not result in an apocalypse.

    the phrase “lost market share” is like what? lost market share to inflation? economic collapse? lost market share to peak oil? lost market share to asian consumption?

  20. DerHundistlos on Thu, 2nd Feb 2017 7:31 pm 

    @ Davy

    Your reply to Pointer was not polite. It’s like there is a My. Hyde aspect to your character regarding all issues Trump/Republican, which is not in keeping with your normal gentlemanly manner.

    I know, sock it to me!!!

  21. Davy on Thu, 2nd Feb 2017 7:50 pm 

    Der Hund, sorry, you are not going to like me. I am too much of a contrast. I don’t fit molds well because I never had one. I am not here to be popular so I am going to tell it like it is and that “is” will be in an eclectic way that will offend everyone in some way. I am a lone wolf type without a home.

  22. rockman on Thu, 2nd Feb 2017 8:44 pm 

    JN – “…the optimism of Tony Seba’s book”. Sometimes the distinction between being “optimistic” and “delusional” isn’t that difficult to recognize. Again 2016: 80+ million ICE’s added to the existing 1.2 billion on the roads. And make conventional cars obsolete in just 13 years??? So exactly when do we see folks start abandoning those 1.28 billion ICE’s on the side of the road?

  23. Apneaman on Thu, 2nd Feb 2017 8:49 pm 

    Here’s what, in quotes, I got out of this article.

    Electric Cars Could – could be – potentially wiping – could have – could erase – could erode – could peak – could be displaced, – could exceed – could reach”

    Buy a lotto ticket and you COULD be rich if the odds are in your favor.

  24. Anonymous on Thu, 2nd Feb 2017 8:59 pm 

    More like a lone sheep there exceptionalist.

    No likes you much either, well, except cloggy. You and him seem to be pretty tight these days.

    (Im willing to bet your sheep dont like you very much either).

  25. makati1 on Thu, 2nd Feb 2017 9:11 pm 

    HAHAHAHAHA! Thanks, Anon. Some of us stick with our beliefs no matter who disagrees. And then there are some who wobble depending on which way the wind is blowing. I understand it blows … hard in Missouri.

  26. GregT on Thu, 2nd Feb 2017 11:42 pm 

    “I don’t fit molds well because I never had one.”

    Hip hip hooray for the red white and blue mould. The one that ‘you never had’ Davy?

  27. GregT on Thu, 2nd Feb 2017 11:49 pm 

    Electric Cars Could Cause Oil Market Disruption on Par With OPEC

    More bloomberg propaganda/BS. I used to laugh my ass off every single day on the morning commute, listening to ‘another bloomberg market minute’.

    Mindless tripe, for the mindless masses.

  28. brough on Fri, 3rd Feb 2017 3:44 am 

    “Electric Cars Could Cause Oil market Disruption on a Par with OPEC.”

    Bloomberg, so thats where all the fake news is coming from.

  29. Hubert on Fri, 3rd Feb 2017 5:00 am 

    Major battery technology can change the game, but I’m not to sure that will happen. Basic battery technology hasn’t changed in hundred years. There was never any need. We need one now. 😛

  30. Davy on Fri, 3rd Feb 2017 5:02 am 

    Greg, you fit the mold of a west coast Canadian piece of shit. All of you over there. I hope you fall off into the sea. That might silence your hypocrisy….blub blub blub. You are the worst with your mild manner ways but huge slimy ego. How is that for Hip hip hooray! Canada is the most disgusting country on the planet and this site is full of you shits.

  31. Hubert on Fri, 3rd Feb 2017 5:04 am 

    NOVA’s special episode on batteries includes Carnegie Mellon University technology
    January 31, 2017 12:00 AM

    WhitacreTOP50-2 Jay F. Whitacre, founder of Aquion Energy, Inc., will be interviewed on “Search for the Super Battery,” a “NOVA” edition airing at 9 p.m. Wednesday on WQED-TV.

    Jay F. Whitacre, founder of Aquion Energy, Inc., will be interviewed on “Search for the Super Battery,” a “NOVA” edition airing at 9 p.m. Wednesday on WQED-TV.
    By David Templeton / Pittsburgh Post-Gazette
    The world long has used batteries to start cars and power toys, electronic devices and flashlights. But nowadays batteries are central to daily life as a power source for computer devices, mobile phones, life-saving medical devices and electric cars.

    Advances in battery technology are necessary, with a Carnegie Mellon University spinoff company already generating storage technology for solar and wind power, given the fact the sun isn’t always shining and the wind isn’t always blowing.

    Growing demand for — and the technological race to create — cheap, reliable, safe battery technology is the focus of the one-hour “Search for the Super Battery,” an entertaining, informative and wholly understandable “NOVA” edition airing at 9 p.m. Wednesday on WQED-TV.

    http://www.post-gazette.com/news/science/2017/01/31/NOVA-s-special-episode-on-batteries-includes-Carnegie-Mellon-University-technology/stories/201701310083

  32. Hubert on Fri, 3rd Feb 2017 5:06 am 

    NOVA:

    http://www.pbs.org/wgbh/nova/tech/super-battery.html

  33. Davy on Fri, 3rd Feb 2017 5:06 am 

    Batteries are too little too late. The batteries we need are stored grain in silos made by permaculture but that is not a priority. One day we will have all these batteries around us but no food. That was smart.

  34. JN2 on Fri, 3rd Feb 2017 5:40 am 

    No food? Cereal production forecast to be record high…

    http://www.fao.org/fileadmin/templates/worldfood/images/home-graph_4.jpg

    [Not sure if img tag will work]

  35. pointer on Fri, 3rd Feb 2017 5:57 am 

    Davy, you are very self-identified. You would do well to take Davy less seriously.

  36. Davy on Fri, 3rd Feb 2017 5:58 am 

    “No food? Cereal production forecast to be record high…”

    JN2, have you ever got your hands dirty and grown something. I have done both. I had a large industrial corn and soy farm around 2000. I am now a small farm doing permaculture. The biggest blindness you Technos have is thinking your tech will keep the food coming to the table. Your fancy gadgets are not going to replace soil erosion, water scarcity, and industrial depletion. Your fancy gadgets will not bring back a hospitable climate. Your nonrenewable renewables are not going to replace all those components to industrial agriculture. Without industrial agriculture you are not going to feed 7BIL and growing. If you cannot support these people and there is a die off, your happy-go-lucky techno-progressive, repressed and corrupted economy is going to short circuit. Your batteries are going to be lying around with nothing to do as you go from three meal, to two meals, to one meal, then to a couple of meals a week. When you get to that point, when I am not sure, think of Davy and what he said about a new direction. Techno is important but it is a subset of “back to the land and quickly.” Without your gizmos because that is not real “back to the land”.

  37. Davy on Fri, 3rd Feb 2017 6:01 am 

    LOL, that is precisely what I am doing pointer and you what you are recommending. Maybe you will wake up one day but I doubt it. How old are you and where are you from? If you have real balls you will tell me and honestly.

  38. Davy on Fri, 3rd Feb 2017 6:34 am 

    More of the menagerie of the grotesque who hate Trump:

    “Reddit Bans Three Alt-Right Forums As Users Blast “Leftist Intolerance”
    http://tinyurl.com/hbw9th4

    In what will undoubtedly be viewed as just another attempt to censor dissenting, conservative political views, Reddit has banned three major ‘alt-right’ subreddits, /r/altright, /r/rightyfriends and /r/alternativeright, this evening for allegedly breaching the company’s content policy restricting the sharing of personal, private information. The so-called ‘Alt-right’ group had roughly 16,000 followers and grew in popularity last summer along with the rise of Donald Trump’s political campaign.

    “The announcement of the ban came just days after Reddit founder Alexis Ohanian penned an open letter trashing Trump’s immigration ban, calling it “not only potentially unconstitutional, but deeply un-American.”

    “Free speech is a wonderful thing, provided it conforms to the prevailing political views of Silicon Valley’s elitist tech billionaires.”

  39. Cloggie on Fri, 3rd Feb 2017 6:48 am 

    Wikipedia: Alexis Ohanian (born April 24, 1983) is an American internet entrepreneur, activist, investor, and best-selling author born in the Brooklyn borough of New York City and based in San Francisco, best known for co-founding the social news website Reddit, co-founding the early stage venture capital firm Initialized Capital, helping launch the travel search website Hipmunk, and starting the social enterprise Breadpig. He was a partner at Y Combinator, and is also the executive chairman of Reddit.

    Give these hipster coastal folks two countries of their own and the problem is solved for ever.

  40. Davy on Fri, 3rd Feb 2017 6:52 am 

    History rhymes and for us dangerously so. Are we facing a new 30’s? This article is sure to ignite ire from the Cheetos whiners.
    “The Uncanny Similarities Between President Trump And FDR”
    http://tinyurl.com/z4dfhwk

    “For the record, I voted for Donald Trump. Not that I was in love with the guy. It was really a matter of default. On the Oklahoma state ballot, I had the choice of Hillary “Crimes Against Humanity + Here Comes World War III” Clinton, the Libertarian candidate Gary Johnson and Mr. Trump. I chose Trump, a populist, sometimes demagogue and buffoon, but a real outsider who might shake the establishment up.”

    “It is still early, but no one can say that the first two weeks of Trump’s administration have been boring or predictable. He loudly called the outgoing CIA director, John Brennan, a liar and said that the agency’s Russia dossier was all fake news. John F. Kennedy said just as much in private and paid the ultimate price for his honesty. Trump has apparently kept on his own private security services, since getting elected, to avoid the same fate as JFK. President Trump canceled the Transpacific Partnership (TPP), which was bad for everybody involved, except the transnational corporations who bribed, extorted and blackmailed some Pac Rim countries into signing on. But even America’s corporate owned Senate and Congress were resisting. Why? Because a signatory country gives up its national sovereignty to a corporate picked “international arbitration commission”…. “So, Mr. Trump, thank you cancelling this Orwellian, plutocratic, corporatocracy. I can assure you, Baba Beijing wants nothing to do with it. China’s leaders want to govern and help their people, not be tyrannized and humiliated by faceless transnational corporations.”

    I watched Trump’s inauguration day speech. I also watched Trump’s press conference, with small and medium sized business owners, and in both cases, I was amazed at the similarities between him and President Franklin Delano Roosevelt (1933-1945). The first observation that really struck me is how much Trump genuinely cares about “the little guy”. Both presidents came from wealthy backgrounds. Both men are “rich, fat and happy”. Both men want to put Americans back to work again and reignite the country’s industrial potential. Both men are disgusted with the usurious, rapacious, private Federal Reserve banking system. Both men have a strong vision for what ails the country. Both men are despised by the elites. Both men take the choice of Supreme Court justices very seriously. Both men know how relate to their constituencies, the man and woman on the street, the little guy and gal, Joe and Jane Sixpack. Conversely, both presidents have a big chunk of the electorate who despise them. Both men talk about keeping America safe from external enemies. Both presidents believe in Keynesian deficit spending, to boost the economy. Both FDR and Trump want to work with Russia.

    These amazing corollaries between Presidents Franklin Delano Roosevelt and Donald Trump will surely grow, as Trump’s presidency takes root. It’s going to be an interesting next four to eight years, indeed. And dare I say, like my grandparents did during the 1930s, that it’s a time for hope? Soul brothers in a parallel universe…

  41. GregT on Fri, 3rd Feb 2017 6:56 am 

    “How old are you and where are you from? If you have real balls you will tell me and honestly.”

    As mentioned here numerous times before Davy, not everyone identifies themselves with their tax farms like you do. Clearly, you are incapable of understanding that.

  42. Davy on Fri, 3rd Feb 2017 7:06 am 

    I understand you completely Greg.LOL.YUK

  43. GregT on Fri, 3rd Feb 2017 7:33 am 

    Luck of the draw Davy. None of us have any choice as to what human imaginary lines drawn in the sand that we were born into, and we are the only species that cannot move freely between them. Human livestock.

  44. Davy on Fri, 3rd Feb 2017 7:37 am 

    I like livestock Greg

  45. Mark ziegler on Fri, 3rd Feb 2017 7:38 am 

    We need a leader who can take the drastic measures and bring us into the future. A comprehensive rail system where there are no cars at all. The pollution from cars would be virtually eliminated and the energy savings from oil would by far surpass anything conceived of.
    https://www.youtube.com/watch?v=sE4A0nPjyqQ

  46. GregT on Fri, 3rd Feb 2017 10:53 am 

    “I like livestock Greg”

    Thanks for clarifying that Davy, but if you don’t mind, I’d rather not hear all of the intimate details.

  47. Davy on Fri, 3rd Feb 2017 11:04 am 

    lol good one Greg!

  48. Cloggie on Fri, 3rd Feb 2017 11:08 am 

    Erdogan is also very deep into life stock, or rather the other way around:

    https://i.imgur.com/UlS9ktU.jpg

  49. GregT on Fri, 3rd Feb 2017 11:09 am 

    You kind of set yourself up for that one Davy. Sorry, couldn’t resist.

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