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Breaking News:

LNG Glut To Continue Into 2020s, IEA Says

The Natural Gas Market Is Set To Boom

The Natural Gas Market Is Set To Boom

With the new lower-for-longer oil…

The Real Cause Of Peak Gasoline Demand

Car

New analysis shows that fuel-efficient cars that utilize gasoline engines will lower oil demand more effectively than the widespread adoption of electric cars, according to an analyst from FGE who spoke to Reuters.

Though Asian and European nations have pledged a shift towards electric cars in the next decade, the biggest threat to oil prices is the implementation of stricter fuel standards, said analyst Cuneyt Kazokoglu.

“It will come, but it will come because of fuel economy, not electrification,” Kazokoglu said regarding the all-feared “peak” gasoline demand point.

FGE predicts that global gasoline consumption will drop by 11.3 million barrels per day due to increased fuel economy by 2040, dwarfing the 5.3 million bpd drop expected from the onslaught of electric cars or hybrids.

“[Gasoline demand] will inevitably peak in 15 years or so,” Kazokoglu said.

China, a country adamant to get electric cars on its roads, says it will not reach peak energy demand until the year 2040.

Previous estimates said the peak would be reached in 2035, but new figures suggest that five years later, demand would be at its highest at 4.06 billion tons of oil equivalent. Rising fuel needs stem from an increasing number of cars on Chinese roads, as a growing middle class adopts new luxuries in their daily lives.

Currently, China is second only to the United States in its overall energy consumption, but the nation’s high coal use causes it to emit almost twice as much carbon dioxide as the first-place consumer. A report by the CNPC earlier this year added that China’s oil demand will grow at a rate of 2.7 percent annually until 2020, after which it will slow to 1.2 percent until the end of the next decade.

Zainab Calcuttawala for Oilprice.com

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  • EdBCN on September 22 2017 said:
    Any study that assumes they'll still be selling a significant number of ICEs after 2030 is so far off it's pointless.
  • snoopyloopy on September 22 2017 said:
    Another clueless study that ignores the fact that electrification is coming for every segment of transportation, not just cars. Cummins debuted their electric truck to be available in 2019, Tesla will show theirs in a month, and electric buses are showing up everywhere, yet the study actually assumes that diesel demand will grow. The peak will be on this side of 2025.
  • Jhm on September 21 2017 said:
    So here is another study that assumes that EVs will only grow at an annualized rate of 19% over 24 years. Imagine the headlines that would emerge if EV growth actually were to slow to that rate. It's not gonna happen, folks.

    The only way to push peak gasoline out past 2030 is to assume a really slow growth rate. At this point it is just wishful thinking that EV growth will slow down to such rates.

    But hey, that part about fuel economy is real too, and that just moves peak demand years earlier.
  • Michelle Shelly LeBoeuf on September 21 2017 said:
    Well those countries better get a move on and spends lots of money on their power grids to set them up with solar & wind power or they are just wasting their time. All those electric cars plugged in will cause more pollution & drain their old power grids especially since every one will plug in at night. Idiots! They can't think past their ignorance on the global warming ban wagon! Oh well! We'll just laugh & drill baby drill.

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