It is fairly common nowadays to see relatively near-term estimates for a point at which demand for petroleum-based fuels begins to decline. The term often used to describe this “tipping point” is Peak Oil Demand. When I say “near term,” I mean right around the corner if you look at an estimate published last year by the International Energy Agency-IEA, an intergovernmental agency headquartered in Paris, France, and originally established after the Oil Embargo of 1973 to help cushion against future oil shocks. This agency has expanded its mission to a fairly broad remit over the years since, and it is not the purpose of this article to detail all its endeavors. One role we will highlight is that of the one it plays in gauging and advising member governments on energy security and energy sources for the coming years.
In that capacity, the IEA in a report entitled, Oil 2023, and published last year settled on 2028 as the year past which the use of petroleum fuels will begin to decline.
“Growth in the world’s demand for oil is set to slow almost to a halt in the coming years, with the high prices and security of supply concerns highlighted by the global energy crisis hastening the shift towards cleaner energy technologies, according to a new IEA report released today.”
This view is largely shared, particularly with respect to liquid motor fuels, by other agencies and organizations that produce long range estimates. The U.S. Energy Information Agency-EIA, Rystad, and Det Norske Veritas- DNV, all show this category tailing off rapidly in the 2030s as electric vehicles assume larger shares of passenger vehicles. We will call this the “Bear Case” for liquid fuels.
As you might expect the Organization of Petroleum Exporting Countries-OPEC, disagrees with this view. In fact in their recent report on oil demand outlook, published in Nov 2023, they see oil demand of all kinds, except for electricity generation, rising from ~105 mm BOPD in 2025, to 116 mm BOPD in 2045. This forecast show use of oil as a road fuel continuing to be the largest source of demand increase for this period.
The report notes that “the divergence between the IEA and OPEC outlooks is largely due to assumptions regarding the speed at which internal combustion engine vehicles will be replaced by electric vehicles.”
What is interesting is that it is very difficult, if not impossible, to see a production trend being established that would support the bear case. In the U.S., we are pumping at a rate of over 13.2 mm BOPD and still importing ~6.7 mm BOPD to feed our nearly 22 mm BOPD daily habit. The U.S. Energy Information Agency-EIA forecasts in their monthly Short-Term Energy Outlook-STEO that by the end of 2025, global production and demand fall into a fairly tight balance at 105 mm BOPD. That certainly isn’t a long-term trend, but as is often said, the long-term trend is made up of a bunch of short-term ones. For my part, I would say that the trend line in the STEO graph below matches the OPEC estimate more closely than the other three.
Both of these notions cannot be true. Which is the correct assumption about future oil demand? Or are they both wrong? What are two factors these two disparate views of oil demand are not taking into account?
The first answer lies in how you interpret the growth of the middle class in China, India, and Africa in terms of energy demand and the final form it will take. The second is the advent of energy demand for Artificial Intelligence (AI), an entirely new source of demand that is just now starting to appear in energy demand forecasts. I discussed one possible outcome of this demand for U.S. natural gas in an article in March 2024.
To be clear, I am not arguing that AI demand will directly impact crude oil demand as a primary source. Most analysts are factoring renewables and natural gas to meet AI demand. What will impact demand for WTI and other baskets of crude is the relationship to light oil production in the U.S. and the associated gas that’s produced along with it. We will leave that discussion for a future article and refocus on our basic topic. What could oil demand actually be when accounting for growth in currently underserved but upwardly aspiring lower classes?
Then there is the Bull Case for oil. Arjun Murti, a well-known energy commentator and partner at energy analyst firm Veriten, as well as a former Goldman Sachs energy analyst, discussed future energy demand in a recent podcast on his Super-Spiked blog. In the episode titled, “Everyone is Rich,” Arjun posits what the impact on world energy demand would be if everyone was as energy-rich as the “Lucky,” 1.2 billion people that live in the Western World. More specifically, Arjun asks what it would mean for the other 7 billion people in China, India, Asia, and Africa to have the lifestyle that Americans, Canadians, Europeans, and a few other countries enjoy. The answer he comes up with on an absolute basis, 250 mm BOPD, using a reference point of 10 bbls a year!
Where are we now? The U.S consumes ~22 bbls of oil annually per capita while China consumes 3.7 bbls per capita. Indians use just 1.3 bbls per annum. That’s a pretty wide gap, and as Arjun notes, “economic growth and energy growth are one and the same. You do not get economic growth without adequate energy.”
One of the arguments put forward by the Peak Oil crowd is that efficiency growth Gross Domestic Product (GDP), and energy substitution will bend the curve on oil demand, as noted in the 2030’s, and spell the twilight of fossil fuels. Arjun points out that there is simply no evidence this is happening using data compiled by Goldman Sachs through 2019. Efficiency gains never lower the amount of energy needed to produce an additional dollar of GDP, above 2.7% GDP growth. A point rarely hit in modern times. To close that gap and attain growth you need more energy inputs. Oil.
Looking at Arjun’s graph below, which uses China as an example, we can see with their present demand of 3.7 bbls per capita which equates to about 15 mm BOPD. With 10 bbl per annum added on for growth in the middle class, you get to 35 mm BOPD to meet Chinese energy demand. Even if China attains 100% Electric Vehicle-EV penetration, not something Arjun (or I) believe is possible, you still have 27 mm BOPD of oil demand. According to SP Global China produces about 4.1 mm BOPD, leaving a gap of about 11 mm BOPD they must import to meet present-day demand.
A point that leads me to what Arjun noted as the ultimate demand limiter and why, although countries that will surely desire to increase their oil usage may not be able to do so. Geopolitical limits to imports. Quoting Arjun, “There is no precedent for countries importing 20-30 mm BOPD” to meet their energy needs. The U.S., before the advent of shale production was importing over 10 mm BOPD as recently as 2005. That’s what we know is possible.
It should be noted that India is in a similar fix and for it to meet Arjun’s 10 bbl per capita standard for being rich, they must import 35-45 mm BOPD. We just don’t know if this can be done from both a logistical and sheer capacity of supply basis. As the EIA graph above highlights global oil production has increased only about 3 mm BOPD since 2019. In order for the world’s poor to become richer, a great deal more oil will have to come to market.
Your takeaway
The message of the growth of the middle class globally often gets lost in the constant blare of climate change and energy transition noise. The fact remains that the world we live in today and the one likely to exist at mid-century, runs on oil.
The notion that the world can quickly and painlessly transition to other forms of energy has developed some, not holes, but gaping craters in recent times. Offshore wind farms are being canceled as costs mount. Car manufacturers are delaying implementation of EV rollouts due to lack of interest from consumers. Communities impacted by siting of solar farms are pushing back on land use as they propose to gobble up large tracts for this purpose.
Roger Pielke, another well-known energy commentator and author, in a post in his Substack, The Honest Broker, cites a White Paper by Vaclav Smil that discusses our energy transition progress to this point-
“All we have managed to do halfway through the intended grand global energy transition is a small relative decline in the share of fossil fuel in the world’s primary energy consumption—from nearly 86 percent in 1997 to about 82 percent in 2022. But this marginal relative retreat has been accompanied by a massive absolute increase in fossil fuel combustion: in 2022 the world consumed nearly 55 percent more energy locked in fossil carbon than it did in 1997.”
Balanced against this lack of progress in substituting oil for other forms of energy is the fact that the world’s energy supply is in a tight balance with demand at present. If the poor of the world make even modest progress toward Arjun’s 10 bbl per annum prognostication in the coming years, the Bull Case for oil will certainly asset itself.
ee on Wed, 22nd May 2024 11:32 am
Play all the fucking theatre that you want, you cannot replenish earth natural ressources because you are just fucking losers without any real power.
Do your fucking useless political theatre if it makes you proud and happy. Go cock suckers humiliate yourself with your political theater
ee on Wed, 22nd May 2024 11:52 am
We hate earth population too much. It was out of question to make your life easy. After all you live in a torture chamber. Instead of making your life easy by giving pure copper to mine, meaning the chemical element Cu, we decided to torture you by attaching two other molecules to the Cu you need to mine. The most common form of copper is CuFeS2 or called Chalcopyrite.
In order to get pur copper (Cu) you have to remove two chemical elements out of the ore to get you copper. You have to remove the (Fe) and you have to remove (S). As I said it was out of question for you to gave you an easily life, we hate you too much for that.
Everything will be revealed before we kill you.
————————————
Oh, let the sun beat down upon my face, with stars to fill my dream.
I am a traveler of both time and space to be where I have been.
To sit with elders of a gentle race this world has seldom seen.
Who talk of days for which they sit and wait
When all will be revealed.
Oh, all I see turns to brown
As the sun burns the ground.
Oh, when I’m on, when I’m on my way, yeah
When I see, when I see the way you stay, yeah-eah
https://www.youtube.com/watch?v=y_6M254L0XU
WHY elite whitey supertard president GRETA has grown two enormous global warming SPHERES on Wed, 22nd May 2024 12:08 pm
good or bad please comment
ee on Wed, 22nd May 2024 12:08 pm
When I telling you that we send the garbage on earth I really mean it. When I am saying I want your cadavers and I will get them, it means it also.
Let’s look at silver molecular formula of the most ore containing silver. That will show you how much we hate you.
Silver-bearing ore typically contains very little silver, with much higher percentages of copper and lead. Specific minerals include argentite (Ag2S), chlorargyrite (“horn silver,” AgCl), polybasite (Ag, Cu)16Sb2S11), and proustite (Ag3AsS3).[2] Silver mainly occurs as a contaminant in chalcopyrite and galena, important ores of copper and lead, respectively.
Look at how much we hate. We are forcing to use complex chemical processes to extract the silver. If this is not hatred, I don’t what it is.
WHY elite whitey (((supertard))) president ALICE did not MUZZ-19 herself with reckless abandonment she did needle retraction and SALINE injection instead and called for censorship of this forum on Wed, 22nd May 2024 12:09 pm
1A must stand or we go 2A
ee on Wed, 22nd May 2024 12:16 pm
You still love the fucking European and their fucking green agenda of wind mills. Still love your fucking Jews.
ee on Wed, 22nd May 2024 12:22 pm
I want the whole population of earth deadé
Notice the long she pronoun the world away at 4:00
I will get your fucking cadavers.
Oh, when I’m on, when I’m on my way, yeah
https://www.youtube.com/watch?v=y_6M254L0XU
ee on Wed, 22nd May 2024 12:28 pm
In a place like planet earth where evil lives, never take away the personal protection of a man. Never put any kind of laws on handguns and firearms possession. I will kill all of you for that.
ee on Wed, 22nd May 2024 12:38 pm
I am killing the whole population of earth for a question of handguns laws. Revelation 19 is me celebrating your death.
ee on Wed, 22nd May 2024 12:44 pm
Je vais vous faire cracher du sang par la bouche, pis ma vous coucher a terre dans votre propre sang, mes criss de tabernacle.
ee on Wed, 22nd May 2024 12:56 pm
Only losers that cannot defend themself love the police. Your fucking cops. These piece of shits cannot die fast enough.
https://www.youtube.com/watch?v=FX4t1lLNl-o
ee on Wed, 22nd May 2024 1:03 pm
I already own your cadavers. You are not intelligent enough to see that earth is a torture chambers. Earth has been designed as a way to amplify your pains and sufferings. This is how much we hate you.
ee on Wed, 22nd May 2024 1:26 pm
You are just fucking losers. It is guarantee I get your Fucking cadavers.
ee on Wed, 22nd May 2024 1:37 pm
The way that we designed earth was around the principle of maximum pain either physical or mental. You physical flesh body is a machine designed to put pain on you.
ee on Wed, 22nd May 2024 1:45 pm
You flesh body has basically been designed to torture you. Why people worship the flesh body is a mystery to some of us. You flesh body is based on the same design as an insect. Your arms and legs are similar to the legs of an ants or spiders. The human shell is indeed the body of insect. The human body hair is similar to insect pilosity.
ee on Wed, 22nd May 2024 1:56 pm
If you look at certain YouTube videos, some of you have faces that start to resemble insects heads.
ee on Wed, 22nd May 2024 2:01 pm
Go look at Bill Mayer. His whole head is turning into a insect head.
https://www.youtube.com/watch?v=TvG3zy8lWYw
ee on Wed, 22nd May 2024 2:04 pm
1:44 it is the face of an insect. Eventually all of you will have insectes faces.
https://www.youtube.com/watch?v=-Hzx7AfLxeM
ee on Wed, 22nd May 2024 2:14 pm
The face of Dua Lipa and Kate Blanchett are starting to resemble the faces of insects.
https://www.youtube.com/watch?v=vC_0nvJBN0E
ee on Wed, 22nd May 2024 2:17 pm
The face of Joe Biden is obviously the face of an insect.
ee on Wed, 22nd May 2024 2:27 pm
Note how we timed everything perfectly. Peak oil, peak copper, people heads turning into insects heads, and many other stuff are all happening at the same time. It is because the end is approaching.
ee on Wed, 22nd May 2024 2:44 pm
That would explain why the whole planet earth think and act like an ant colony because the population of earth are not really humans, you are insects, so you think and behave like insects.
THE diseased minds of libs gave us the Convid and BUILD back better but now were on global warming and ELITE whitey supertard president GRETA has grown two enormous GLOBAL WARMING SPHERES on Wed, 22nd May 2024 3:08 pm
they own everything the diseased minds of libs own everthing
ee on Wed, 22nd May 2024 3:23 pm
Criss de trou du cul et deminable.
ee on Wed, 22nd May 2024 3:25 pm
Câlisse que j’ai hâte que vous mourriez tous. Câlise que vous me faites chier.
ee on Wed, 22nd May 2024 3:43 pm
Notice how good we are. Everything is happening at the same time: peak oil, peak copper, hyperinflation, people heads turning into insects heads, stock market at its highest, political system in disrepair state, corruption everywhere you look, greed everywhere you look, inflated ego everywhere you loom, lying has become the norm.
This is the end for you, it is a new beginning for me.
ee on Wed, 22nd May 2024 5:17 pm
You are just fucking losers without any power. This is why you have to use these cheap tricks to scare people. It is because you are losers without any real power. If you were powerful, you would have modified earth calculator to keep earth reality alive. I piss and shit on you and I want you dead.
Il avait prémédité le meurtre de sa mère, il est finalement déclaré non criminellement responsable
https://www.youtube.com/watch?v=Wb9_AYMWw6k
Never take away the handguns of a man where evil rules. I will kill you for what you did to me.
ee on Wed, 22nd May 2024 5:21 pm
I will set the fucking earth on fire and kill you all just for a question of handguns.
ee on Wed, 22nd May 2024 5:27 pm
You are just fucking loser. This is all you have, these fucking cheap headlines in the news media to scare people. You are just fucking losers without any powers.
Présidentielle américaine: le Canada «prêt à toute éventualité» – Reportage, 18h
https://www.youtube.com/watch?v=ewZOdsIXziU
ee on Wed, 22nd May 2024 7:28 pm
I was not expecting this kind of outback.
https://www.youtube.com/watch?v=JZnSAzRsum4
eee on Wed, 22nd May 2024 7:32 pm
This is almost 20 inch of water if you look at the water level on the front tire.
https://www.youtube.com/watch?v=HXhW6nHf2iY
ee on Wed, 22nd May 2024 8:31 pm
What is the combat usefulness of this. Looks like a waist of money.
https://www.youtube.com/watch?v=T6qYD3bualM
ee on Wed, 22nd May 2024 8:35 pm
What is the combat usefulness of this. Looks like a waist of money. This shit piece of crap need a cement ramp to get out of water. What a fucking joke.
https://www.youtube.com/watch?v=T6qYD3bualM
ee on Wed, 22nd May 2024 8:40 pm
What a fucking joke. Look at the brass cartridge made of copper and zinc at 2:34. Give me fucking break, we are out of copper.
https://www.youtube.com/watch?v=T6qYD3bualM
ee on Wed, 22nd May 2024 8:54 pm
Someone somewhere is making fun of the US navy captain job.
https://www.youtube.com/watch?v=EvMoYU-nuEE
WHY elite whitey supertard president GRETA has grown two enormous global warming SPHERES on Wed, 22nd May 2024 8:56 pm
what the point Convid gona kill us all global warming gonna kill us all ZOMFG
I know some wrong when a pretty little white girl ran to a black mans arms dead giveaway
deeeeeeeeeeeeeeeeeeeeeeaddd giveaway
ee on Wed, 22nd May 2024 9:06 pm
How Caterpillar Went From A Local Company To A Billion Dollar Business
https://www.youtube.com/watch?v=Bv6PMxxtqK4
Caterpillar was given to us from the underworld. All the tech we have was invented centuries ago and transfert to us bu creating big corporations.
ee on Wed, 22nd May 2024 9:46 pm
Only people that will leave earth will live.
ee on Wed, 22nd May 2024 9:51 pm
Nobody is leaving earth, unless you get some divine protection and a new body to deal with different energy fields that are outside of earth.
ee on Wed, 22nd May 2024 9:56 pm
You made the mistake to put safety above freedom. You made the mistake to worship women, when you should have been worshipping masculine man. You are too stupid to be kept alive. Never take away the handguns of man. Some men will kill the whole population of a planet just for that
ee on Wed, 22nd May 2024 9:58 pm
Women and sex only exist on planet earth. We created women to torture the population of planet earth. Any real masculine man with an high IQ can see that.
eee on Wed, 22nd May 2024 10:06 pm
This is how we partially determine which men has an high IQ. Men that have realized in a early age that women are mentally retarded and should be avoided has a lot of changes to leave earth. If you are a women, you are staying on earth and you die.
Everything must be revealed. Sometime I feel that I am just a conduit for GOD.
ee on Wed, 22nd May 2024 10:08 pm
I personally prefer men that deeply hate women and want to kill them.
de on Wed, 22nd May 2024 10:15 pm
As long as I am on earth, I am comfortable with the murder of women and cops.
ee on Wed, 22nd May 2024 10:22 pm
You want to know what was the temperature outside my house after I wrote the comments above, 22.2. Apparently GOD approves.
What is the temperature outside my house while I am writing this comment, you guess it 22.2.
I have a digital thermometer I made with an Arduino board and I am using a thermistor to measure the temperature.
ee on Wed, 22nd May 2024 10:34 pm
This is GOD hating on Women. Why do you think she is dressed the way she is
https://www.youtube.com/watch?v=OFyCSDzn2Q0
Look at how she is dressed. She is dressed like a fucking whore. This is GOD telling you that he hates women. Same as I do.
https://www.youtube.com/watch?v=h2veI5qnKxo