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Higher electric vehicle (EV) adoption and rising fuel efficiency will bring peak road transportation fuel demand forward to 2027, four years earlier than previously thought, BloombergNEF said in a report on Tuesday.
Last year, BloombergNEF was expecting gasoline and diesel demand for passenger vehicles and trucks to peak in 2031. However, this year, BNEF expects steep declines in fuel consumption in Europe and the United States, where more EVs are being sold while conventional vehicles become increasingly efficient.
On the other hand, the previously expected jump in gasoline and diesel sales in the large developing markets such as China and India will not be really a jump, BNEF notes.
“Policy makers are driving the automotive market toward low-carbon options and improved fuel efficiency,” Bloomberg quoted BNEF as saying in its report. “Automakers and large fleet operators are also, in turn, aiming for long-term decarbonization.”
“Fuel producers with exposure to markets like the U.S. or Europe are poised to see sales of diesel and gasoline decline significantly from current levels over the next decade,” according to BNEF analysts.
Earlier this month, BNEF said that the rollout of EVs will lead to the United States and Europe losing more than 8 million barrels per day (bpd) of existing demand. On the other hand, India and China are set to “miss out on over 6 million b/d of growth,” BNEF noted.
In its latest annual Electric Vehicle Outlook published last month, BNEF forecasts that the share of global sales of zero-emission cars would jump from 4 percent of the market in 2020 to 70 percent of the market by 2040. This outlook is based on the research firm’s Economic Transition Scenario, which assumes no additional policy measures. In this year’s report, BNEF also added a Net Zero Scenario for the road transport sector.
The scenario shows that zero-emission passenger cars, for instance, would have to hit almost 60 percent of sales in their segment globally by 2030, not 34 percent as they do in the Economic Transition Scenario—that’s 55 million EVs sold in that year, as opposed to 32 million.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.