EVs Bite Into Oil Demand But It Will Take a While to Hurt

This article first appeared on the BNEF mobile app and the Bloomberg Terminal.

  • Demand drops by 18.8 million b/d by 2050 vs 2019
  • The U.S. and Europe lead declines in consumption

As demand for road fuels like gasoline and diesel recovers post-pandemic in markets such as the U.S. and Spain, long-term road fuel demand is set to drop dramatically, according to BloombergNEF.

Electric Vehicle Outlook 2021 Read the executive summary report here

While road fuel demand looks set to peak in 2027, the impact of advancements is not materially felt until almost a decade later. Efficiency improvements disrupt growth this side of 2030, before alternative drivetrains and autonomous vehicles cut into road fuel use in the longer term.

Emissions almost halve by 2050, but the sector gets nowhere near net zero. By the 2050s fossil-derived road fuel demand falls below levels last seen in the early 1970s. Oil-related emissions drop to 3.4 gigatons CO2 by 2050, down from almost 6.5Gt in 2019.

Fuel producers with exposure to markets like the U.S. or Europe, like BP and Shell, may see sales of diesel and gasoline decline significantly from current levels over the next decade. On the other side of the world, in markets like India and China, demand growth that ‘could have been’ fails to materialize.

BNEF Shorts are research excerpts available only on the BNEF mobile app and the Bloomberg Terminal, highlighting key findings from our reports. If you would like to learn more about our services, please contact us.

About BloombergNEF

BloombergNEF (BNEF) is a strategic research provider covering global commodity markets and the disruptive technologies driving the transition to a low-carbon economy. Our expert coverage assesses pathways for the power, transport, industry, buildings and agriculture sectors to adapt to the energy transition. We help commodity trading, corporate strategy, finance and policy professionals navigate change and generate opportunities.
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