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FX.co ★ Buoyant oil demand to belong to history in near future

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Forex Humor:::2020-09-22T07:28:56

Buoyant oil demand to belong to history in near future

Global petroleum demand is set to reach its peak in the early 2020es, BP Plc stated in its outlook for the global energy industry. BP experts predict that oil demand will be fizzling out in the not-too-distant future.

The world’s oil and gas supermajor company suggests three scenarios of the global transition to environmentally friendly kinds of fuel. Such scenarios have something in common. Each of them underlines contraction in oil demand in the nearest 30 years as well as crucial changes in the principles of energy demand. BP analysts say that lower consumption of conventional kinds of fuel will be offset by a growing share of renewable energy sources.

According to the basic outlook, BP experts point out the trend in the approach to energy consumption worldwide. Governments adjust political decisions and social stance for innovations. Following a revival in the wake of the COVID-19 pandemic, demand for crude is expected to reach a plateau. In this case, experts reckon that petroleum demand will fall 10% in the next 30 years.

The second forecast which is termed rapid suggests that oil demand will plummet 55% in the 30 years to follow. BP analysts think that high rates of oil consumption will belong to history soon. The global petroleum market will hardly recover to the soaring consumption rates of 2019 i.e. 100 million barrels per day. Experts are certain that the global economy will never surpass this peak of consumption. The reason behind such a sharp contraction in demand is that eco-conscious governments will introduce a series of measures to protect the environment. One of them is an increase in the tax on CO2 emissions that will ensure a 70% reduction of CO2 volumes in the air by 2050.

The third scenario which is termed clean warns that countries worldwide will eventually reject the idea of oil consumption. According to this radical outlook, petroleum demand will crater the whopping 80% in the nearest 30 years. This means almost total rejection of traditional fuel, BP experts underscore. However, this scenario is plausible only on condition that most countries in the world introduce energy-saving measures that will be welcomed and implemented by the population. These measures could include such programs as the economy of a circuit cycle, joint consumption, and a transition to low carbon energy sources.

BP experts predict that oil demand will be ebbing away amid growing popularity of electrically-driven cars and electricity adoption across the board. Besides, all three scenarios suppose that the peak of oil consumption by vehicles will fall into the middle and the end of 2020es. According to the basic scenario, the share of oil for transport needs will tumble 80% by 2050. Analysts expect this criterion to plunge 40% in the rapid scenario. The clean scenario suggests a 20% reduction.

BP economists believe that despite the COVID-9-driven havoc, the global economy will be able to shift smoothly towards renewable energy sources with modest losses on the back of active political moves when adopting low-carbon policies among companies and individual consumers.

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