Energy Stat of the Week

Energy Stat: Are Electric and Autonomous Vehicles Heading Down the Road to Peak Oil Demand?
March 20, 2017

Most of our readers, it’s safe to say, would rather have us predict oil prices over the next 24 hours than the next 24 years. While we generally stay away from making ultra-short-term trading calls, we are equally averse to throwing out forecasts that extend decades into the future. If you want to read opinions/guesses on where oil prices will be in, say, 2040, there are several options to choose from: EIA, IEA, etc. We are not about to join that club, but we will take this opportunity to provide some thoughts about an increasingly common topic of discussion: when will global oil demand peak? This is a relevant question for energy investors who are making decisions with a long-term timeframe in mind. We would not discourage anyone from taking this issue into consideration. But we want to make our view crystal-clear: while peak oil demand is something that will eventually happen, it is exceedingly unlikely to materialize within what the vast majority of investors would consider an investable timeframe. While it would be rather silly (and academic) for us to specify a particular year, we are comfortable stating that there is no realistic way that global oil demand can peak until after 2025 at the earliest, and more likely beyond 2030.

This is a summary of a much more detailed commentary. Please contact your financial advisor for the full report.

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Marshall Adkins

J. Marshall Adkins
Director of Energy Research