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.
eee on Sat, 11th May 2024 7:05 pm
If you were a real GOD you would have killed the Jews already. A real GOD does not need to do real theatre to kill Jews. If you were a real GOD, you would have deposited money directly in my account. Go fuck yourself.
eee on Sat, 11th May 2024 7:07 pm
We are going to burn down this shit planet.
ee on Sat, 11th May 2024 7:09 pm
A real GOD does not to theater. A real GOD act. You are just a fucking fraud. Watch us burn you shit planet.
ee on Sat, 11th May 2024 7:13 pm
Des aurores boréales illuminent le ciel du pays
Un spectacle visible en raison d’une tempête solaire d’une rare intensité, qui se répétera samedi (11 mai 2024)
https://www.youtube.com/watch?v=a5EMIV51hj8
Watch us burn down your shit planet.
ee on Sat, 11th May 2024 7:18 pm
I will repeat that never denied a man personal protection using handguns. I am going to burn down planet earth just for that reason.
ee on Sat, 11th May 2024 7:35 pm
What is lake of fire, it is us burning down the fucking planet. Never take away the rights of a man to carry handgun on him without a license. I will burn your shit planet to the ground just for that.
ee on Sat, 11th May 2024 7:38 pm
I will burn your fucking planet to the ground. Watch me going.
Watch: Northern Israel Is Literally On Fire After Hezbollah Attacks
https://www.zerohedge.com/geopolitical/watch-northern-israel-literally-fire-after-hezbollah-attacks
Hezbolland did not do anything, we did it. Watch burn your shit planet to the ground.
ee on Sat, 11th May 2024 7:46 pm
Hezbollah might have started the fire, but we are the ones that have decided how big the fire will be and in what directions the fire would travel. I am going to burn your shit planet to the ground.
ee on Sat, 11th May 2024 7:50 pm
We did the exact same thing with the cargo ship that hit the Baltimore bridge. It us that have steered the shit to enter in collision with the Baltimore bridge. We did again with the fire.
I will burn your shit planet down just for a question of handguns.
dd on Sat, 11th May 2024 9:01 pm
I was just getting out of bed after a nap because my body was hurting to much. I started to rotate around the vertical axis of my body. I felt like I had no legs and I was about to leave earth.
The only good explanation I could find is that my spirit took control of my body and sent electric signals to my spine and move my legs for me. You always to negotiate with our spirit what kind of access he can have to your body. i told there is good chance that earth control will be transferred to me. Then I will own your fucking asses. i am surprised I did not felt on the ground.
The Spirit Body of the Monad is the higher mind function of the Observer, watching and aware of forming concepts and making assessments. It is the higher mind principle consciousness that comes to neutral conclusions and decisions based on accumulated experiences. When the spirit is in control of the nervous system of the body, it makes higher evolution
of Consciousness action possible.
I will set this piece of shit earth in fire for a question of handguns.
eee on Sat, 11th May 2024 9:14 pm
Look at the crowd at one of the Trump. They look fake, 2:27. I will set this piece of shit earth in fire.
https://www.youtube.com/watch?v=HdAjpYFuAZ8
ee on Sat, 11th May 2024 10:23 pm
This is why I like smaller helicopters mounted with machines. Imagine the damage you can do with that.
https://www.youtube.com/watch?v=M9A8n1fsolY
ee on Sat, 11th May 2024 10:31 pm
They can be easily refuel and reloaded in ammunitions in a near by area and put back into combat rapidly. Don’t need a lot of staff.
https://www.youtube.com/watch?v=yMkqf582M-Y
eed on Sat, 11th May 2024 10:40 pm
A10 would a fantastic job in these type condos development 11:55
https://www.youtube.com/watch?v=2SgdoXNMPDU
https://www.youtube.com/watch?v=NvIJvPj_pjE
eee on Sat, 11th May 2024 10:52 pm
The problem with the A10 is that its must go back to base for refueling and reloading, you don’t have this problem with the small helicopter, you can refuel and reload in a near by area.
ee on Sat, 11th May 2024 11:27 pm
US campus protestors call for beheading of school president with ‘guillotine’ chants
https://www.youtube.com/watch?v=v0uwOzuLMCU
You guy are panicking. You really want to save this shit earth.
ee on Sat, 11th May 2024 11:31 pm
US campus protestors call for beheading of school president with ‘guillotine’ chants
https://www.youtube.com/watch?v=v0uwOzuLMCU
You guy are panicking and really want to save earth or you guys are looking for revenge for the destruction of your nation. I really don’t give.
Is it my holographic matrix that is being activated and turned on
ee on Sat, 11th May 2024 11:51 pm
They cannot leave the zone. They are parasites that will move to another area and drain it. Most likely they will either leave the area on car or by foot. Should be easy to block these exit road and kill them when they try to leave the area. This is where the pickup truck equipped with machine guns will come handy. Of course you shut down the public transportation system before the attack so they cannot leave the area. Should be easy to establish choke point on roads leading or leaving area and kill them there.
Maybe I am just a loser making shit up.
ee on Sun, 12th May 2024 12:12 am
A month before the attack, you block certain road leaving out of the area with ciment blocks. You could also dig a big hole and put some old discarded trucks, cars or heavy equipment. The goal of this is to force them use certain roads to leave the city. These chokes points is where we will kill them. Pickup trucks will patrol the outside area and kill everyone trying to leave on foot.
eee on Sun, 12th May 2024 12:41 am
Because of these restrictives handguns and firearms laws, cities are without any kind of efficient weapons. Their firearms restrictives laws will turn against them and cities won’t be able to defend themself. It is like shooting a fish in a barrel. Police station might have firearms, but it won’t make any significant difference.
Never put any kind of laws on firearms possession, it will turn against you.
eee on Sun, 12th May 2024 1:17 am
Never take away the handguns or firearms of a man. It will turn against you at the least expected moment. The smart cities are dead trap. If you try, you could not do better.
Dredd on Sun, 12th May 2024 2:58 am
“Must be the season of the witch” – Donovan (a href=”https://blogdredd.blogspot.com/2024/05/seaports-with-sea-level-change-35.html”>Seaports With Sea Level Change – 35)
Dredd on Sun, 12th May 2024 2:59 am
Seaports With Sea Level Change – 35
eee on Sun, 12th May 2024 8:31 am
I want your fucking cadavers stupid cock sucker. The law of conservation of mass will give them to me. I told you how to kill, you
eee on Sun, 12th May 2024 8:35 am
I don’t need to be part of militia. I just have to wait for your cadaverse. They will be given to me using the principle of conservatoin of mass.
eee on Sun, 12th May 2024 8:36 am
I am happy I might have been able to destroy my relationship with my spirit. I want this cock sucker dead.
ee on Sun, 12th May 2024 8:41 am
I don’t need to do anything to kill you cock sucker. Earth has run out of natural resources.
ee on Sun, 12th May 2024 9:32 am
We build earth as an execution chamber and you are not getting out of if. Some might seek revenge against their ennemies. There is no invasion. Wh are sending the crap we don’t like on planet earth. There is no inner earth. Normally you would seek revenge against the Jews if you were not coward.
eee on Sun, 12th May 2024 9:38 am
You disarms the population with your restrictive firearms laws. Cities are defenseless from an attack for the outside. Never take away the firearms of a man, it will come back against you and you will easy to massacres if some enemy decide to do so. Don’t count on the loyalty of your security force and armies. This has been a fatal mistake made by the elites to believe.
ee on Sun, 12th May 2024 9:41 am
You did not give me a salary, I will never help you kill the invader. You can go fuck yourself.
ee on Sun, 12th May 2024 9:53 am
Never take away the firearms of a man and never build cities with centralized services. It is a dead trap from which on you might be able to escape.
https://www.youtube.com/watch?v=aLHkwiB5ZNk
ee on Sun, 12th May 2024 9:55 am
https://www.youtube.com/watch?v=5tKnAg6ZN-o
ee on Sun, 12th May 2024 1:06 pm
You can all go fuck yourself. I will for the principlae of conservaton of mass to kill evertyone living on earth. All go fuck yoiurself
ee on Sun, 12th May 2024 2:00 pm
Cites are dead trap you are unarmed and defenseless. We even don’t need helicopters. Just block entries roads into your city. That will stop the trucking deliveries leaving the cities without a resupply of goods. . We just need to patrol the outside area with pick up truck to kill everyone that is trying to leave on foot. We even don’t need machine gun. We could use full automate riffles. Regular cheap pickup trucks will do the just, people living in the cites are unarms,
eee on Sun, 12th May 2024 2:10 pm
Most likely people will try leave the city on foot and will travel along the highways to go to the nearby town. We will kill you there on the highway where you are the most vulnerable with A10 or helicopters. You are such an easy target since you are unarmed and defenseless.
ee on Sun, 12th May 2024 2:15 pm
Imagine that, you are defenseless and unarmed. We don’t need to add steel plate to protect the troops against bullets, you are unarmed. We can sit on the back of a pickup truck on a chair and fire at you directly. What are you going to do about it.
eee on Sun, 12th May 2024 2:23 pm
Never put any king of restrictions on firearms ownership. It will be used against you.
eee on Sun, 12th May 2024 2:46 pm
We are going to set this piece of shit on fire. You are too stupid to be kept alive.
eeed on Sun, 12th May 2024 2:47 pm
I wont be happy until everyone living on planet earth is dead.
ee on Sun, 12th May 2024 3:51 pm
You are a real GOD or you are not. If you need to make all kind of fake theater to kill the Jews, instead of killing them directly, you are just a fucking fraud.
I want to speak with the creator that has created earth calculators. He is the real GOD. You are just a fucking loser to me not worth bothering with.
eee on Sun, 12th May 2024 6:11 pm
‘A Total Betrayal Of Our Friend’: Ted Budd Blasts Biden Over Israel
https://www.youtube.com/watch?v=8FNPRsUMNwU
I always knew you were just fucking losers. A real GOD would have used earth calculators to kill the Jews. He would have created an invisible blade to cut the head of the jews, and float the heads of Jews up in air by attaching some kind of eternal lifting device to the head of the Jews. All this woud have been done mathematically. You are just fucking loser playing losers theater.
ddd on Sun, 12th May 2024 9:09 pm
You are just fucking useless losers. You are not a real GOD, you are just fucking loser. A real GOD will have not bother withthis BS theater and will have killed all the Jews using earth calculator.
You are just fucking pathetic losers, all of you.
ee on Sun, 12th May 2024 9:48 pm
The democracies supposes that you have to talk (2:13). Listen to that piece of shit bitch that has probable does not know what a supply chain is. I should talk to mentally retarded people to help me make a decision. Fucking piece of shit communists. I will burn this shit earth down. You are just fucking loser and the GOD has abandoned earth. I really hate Europeans and Jews.
https://www.youtube.com/watch?v=gx9JgAn1mWQ
eee on Mon, 13th May 2024 4:27 am
Fucking cock sucker, I will set the whole planet in fires. fucking low IQ losers.
eee on Mon, 13th May 2024 5:13 am
I always knew you were just fucking losers and not real GOD. A real GOD would have killed all the Jews by just giving them heart attacks or decapitate them in place using earths calculators.
You are just fucking losers. You have to use BS fake theater to kill the Jews and even that is not working. Fake protests on universities campus that lead nowhere. I knew you were just fucking losers.
eee on Mon, 13th May 2024 6:07 am
I hate UK, The Jews and the fucking Europeans. I think I will set them on fire first.
ee on Mon, 13th May 2024 6:22 am
Fuck I hate the British, the Jews, and the Europeans. All fucking pathetic communists.
ee on Mon, 13th May 2024 6:24 am
I will set this pieces of shit earth in fire. Hell awaits earth.
https://www.youtube.com/watch?v=dbFGK1inonk
ee on Mon, 13th May 2024 6:30 am
I will burn your shit planet down to ground into ashes.
ee on Mon, 13th May 2024 6:33 am
I will burn your shit planet starting by UK, Israel and Europe.