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The world is past peak coal consumption and may reach peak oil consumption within the next ten years, Alexei Kudrin, the head of the Russian Accounts Chamber, told media this week.
The official noted Russia will need to learn to rely less on oil export revenues over these next ten years. Otherwise, Kudrin added, this will become a serious problem in 20 years.
Meanwhile, investments are necessary now to diversify the Russian economy away from oil, Kudrin said, noting steps being made in that direction, specifically in the digitalization of the economy and in science and innovation.
"Maybe we should have started working in that direction a bit sooner," the official said.
The remarks of the Accounts Chamber's head echo earlier comments made by Russia's deputy financial minister.
"The peak of consumption may have already passed," Vladimir Kolychev told Bloomberg in an interview last year. "The risk is rising in the longer term."
Russia has been paying more attention to the prospect of peak oil demand recently, with the head of the energy committee at the Russian parliament, the Duma, saying in April that "Everything that can be produced should be produced while there is still demand to sell it."
Like other large oil exporters, Russia will be seeking to monetize as much of its oil and gas resources as quickly as it can.
Russia is one of the three biggest oil exporters in the world, alongside Saudi Arabia and the United States. It has enough oil to keep producing at current rates at least until 2080, with enough gas reserves to last for another 103 years. And the state is pouring billions-$110 billion to be precise-into developing new oil reserves in eastern Siberia to tap 100 million tons of new crude annually. That's about a fifth of the country's annual output in 2019.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More
Comments
In saturated markets this percentage of new cars added to the total is lower then in emerging markets but I was never able to find a clear percentage named that defines how much percent of new sales is added to the total cars on the road in the world.
The number of car sales in the world is around a hundred million so if this number is for example 25% then 25 million cars added to the total of internal combustion engine cars on the road create our yearly growth in oil demand (apart from growth in use of plastics, fertilizer and other use for the production of important chemicals)
If electric car sales reach this number, growth in oil demand is over and peak demand is a reality.
Also if oil is still legal, how is it possible to have pick oil in ten years from now when there will be fewer gasoline combustions cars on the road, if any?
It is prudent to scale down operations for an orderly transition to clean renewable economy.
However, they all share one thing: they are absolutely wrong. I will explain why.
There can never be a post-oil era throughout the 21st century and probably far beyond because it is very doubtful that an alternative as versatile and practicable as oil, particularly in transport, could totally replace oil in the next 100 years.
There can never be a peak oil demand either. Global demand for oil will continue to grow fast as a result of rising population from the current 7.9 billion to 9.7 billion by 2050 and growing global GDP expected to rise from $91 trillion now to $266 trillion also by 2050. While a wider use of EVs could slightly decelerate the rise in demand, it could never arrest its growth.
There are plenty of proven reserves in the world to satisfy rising global oil demand for years to come with advances in technology enabling the world to improve its oil recovery factor (R/F) and finding new oil in the Arctic and the oceans.
There is equally rising demand for oil projected to hit 114 million barrels a day (mbd) by 2030.This isn’t a sign of peak oil demand.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London