OPEC quintupled its forecast for sales of plug-in EVs, and oil producers from Exxon Mobil to BP also revised up their outlooks in the past year, according to a study by Bloomberg New Energy Finance (BNEF). The London-based researcher expects those cars to reduce oil demand 8 million barrels by 2040, more than the current combined production of Iran and Iraq.
Growing popularity of EVs increases the risk that oil demand will stagnate in the decades ahead, raising questions about the more than $700 billion a year that’s flowing into fossil-fuel industries. While the oil producers’ outlook isn’t nearly as aggressive as BNEF’s, the numbers indicate an acceleration in the number of EVs likely to be in the global fleet.
“The number of EVs on the road will have major implications for automakers, oil companies, electric utilities and others,” Colin McKerracher, head of advanced-transport analysis at BNEF in London, wrote in a note to clients. “There is significant disagreement on how fast adoption will be, and views are changing quickly.” BNEF expects electric cars to outsell gasoline and diesel models by 2040, reflecting a rapid decline in the cost of lithium-ion battery units that store power for the vehicles. It expects 530 million plug-in cars on the road by 2040, a third of worldwide total number of cars.
The Organisation of Petroleum Exporting Countries raised its 2040 EV fleet prediction to 266 million from the 46 million it anticipated a year ago. Battery cars under the new projection account for 12 per cent of the market within 23 years, compared to 2 per cent in the 2015 forecast. Based in Vienna, the group representing 14 nations expects half the number diesel vehicles as it did a year ago.
Others making similar expectations according to the BNEF note include:
The International Energy Agency more than doubled its central forecast for EVs, raising its 2030 EV fleet size estimate from to 58 million from 23 million. Exxon Mobil boosted its 2040 estimate to about 100 million from 65 million.
BP anticipates 100 million EVs on the road by 2035, a 40 per cent increase in its outlook compared with a year ago. Statoil ASA, the Norwegian state oil company, says EVs will account for a 30 per cent of new sales by 2030.
Just a fraction of the world’s cars sold today are powered by batteries instead of gasoline. Many analysts increasingly say the market will expand rapidly as almost all major auto makers bring dozens of new EV models to market. OPEC said in its oil market report on Wednesday that electric vehicle sale targets could dampen demand in some parts of Asia as soon as 2018.
Long-term growth depends on a wide range of factors, including policy decisions by governments seeking to tackle air pollution to the cost of the lithium-ion batteries that account for about a third of the cost of each one.
Latest posts by Business-Standard.com (see all)
- India’s Refiners Bet Big On Petrochemicals As Industry Reshapes – August 11, 2017
- Govt Tweaks HPCL’sTerms Of Sale To ONGCTo Avoid ‘open Offer’ – August 9, 2017
- Oil Falls For Third Day As Doubts Over OPECCuts Linger – August 9, 2017