With world oil prices barely touching $40 a barrel and BP announcing major cutbacks in oil exploration you may be thinking this is an odd moment to talk about needing to head off an oil price spike. But the fact that oil companies are scrapping plans for oil exploration is itself a warning sign that as and when the world economy recovers there is not going to be enough production to meet demand. Sure, long term we are heading for peak oil demand as the increasing use of electric vehicles of various sorts cuts into oil demand – but as yet we are yet to see much influence of this trend on oil demand. Indeed with electric vehicle sales still struggling to get above 2 per cent of new car sales this growth could easily, for the moment, be overshadowed by a drop in oil prices in recent times which encourages less fuel efficient petroleum based vehicles to be purchased. That is especially the case as more SUVs are being put on the road, for example in the USA.
100% Renewables 26th June 2020 read more »