Self-driving electric vehicles to crimp oil demand by 2040: BP

Source:Reuters-Global Times Published: 2018/2/21 19:43:40

The emergence of self-driving electric vehicles (EVs) and ride sharing are set to dent oil consumption by 2040, oil and gas giant British Petroleum (BP) said, forecasting a peak in demand for the first time.

In its benchmark annual Energy Outlook, BP forecast a 100-fold growth in electric vehicles by 2040, with its chief economist Spencer Dale painting a world in which we travel much more but instead of using private cars, we increasingly share trips in autonomous vehicles.

Under BP's Evolving Transition scenario, which assumes that policies and technology continue to evolve at a speed similar to that seen in the recent past, some 30 percent of car kilometers will be powered by electricity by 2040 from almost zero in 2016.

At the same time, the number of EVs is set to increase from 3 million today to over 320 million by 2040, representing roughly 15 percent out of a total car fleet of 2 billion.

The gap between the increasing number of EVs on the road and the kilometers powered by electricity is due to the expected growth in so-called shared mobility by EVs, Dale said.

As a result, fuel demand from the car fleet is forecast to dip to 18.6 million barrels per day (bpd) in 2040 from 18.7 million bpd in 2016, when it represented around one-fifth of total oil demand, according to BP.

BP expects autonomous vehicles to become available in the early 2020s.

Their initial high cost means the vast majority of the cars will be bought by fleets offering shared mobility services.

Overall energy demand will continue to grow in the coming decades, rising by one-third into 2040, or roughly 1.3 percent per year, driven by growth in China and India, but the world is learning to "do more with less energy" as economies become more efficient, Dale said.

For example, the European Union's gross domestic product is set to treble in 2040 from 1975, but the level of energy demand will be the same.

China's energy demand will continue to grow, however, at a slower pace by the 2030s when India will become the main driver of growth.

BP once again revised upwards its forecast for growth in renewable power, which is set to grow by 40 percent by 2040, with its share in the energy mix increasing from 4 percent to 14 percent.

"There is plenty of scope for policy to continue to surprise us" to further boost the growth in the renewables, Dale said.



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