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Why This Matters: Looking back at the 2010s, it was the best of times and the worst of times — both renewable energy and fracking boomed, making energy prices low — which is good for businesses and consumers alike. However, energy analysts see the handwriting on the wall — that, as one put it, “[y]ou can paint a pretty bearish picture that oil demand is going to plateau before 2030.” Even CEO Ryan Lance of ConocoPhillips acknowledges that it is a “mature industry,” while others note the “vicious negative feedback loop” caused by many downward forecasts for oil and gas demand over this decade. Good. The negative climate feedback loop that increases warming globally may have a virtuous twin — one that spells the end of the massive over-exploitation of oil and gas. And this is particularly true if more governments (including the U.S.) encourage the use of renewable energy and electric vehicles.
Oil and Gas Crystal Ball
According to the Houston Chronicle, “concerns are mounting in the oil and gas industry that peak demand is not only coming, but coming faster than anticipated, all as the shale boom begins to slow, companies slash jobs and Wall Street turns its back on the energy sector after years of generating lackluster returns.” What are the signs? Energy industry analysist cite:
The Standard & Poor’s (S&P) 500 Index is up more than 25 percent in 2019, while that of oil and gas producers has plunged more than 15 percent.
The energy sector comprises only 4 percent of the S&P 500 after peaking at 14 percent just over a decade ago.
in 2019 Exxon Mobil fell from the ranks of the S&P 500’s 10 biggest companies for the first time because “investors are hesitant to put money into a mature industry that is barely growing.”
Peak Demand By The Numbers
The Chronicle reported that as of the end of 2019, globally the demand for oil is about 101 million barrels a day, with the United States producing more than 12 million barrels a day, but the projected peak demand to be between 105 million to more than 115 million barrels a day. And U.S. demand for oil is expected to remain the same due to improved fuel efficiency in cars (despite the Trump administration’s best efforts to stunt that improvement) and the rise of electric vehicle usage. The latest report from the International Energy Agency, using a mid-range scenario, in which governments do more to reduce carbon use than they are now without being extremely aggressive, forecasts oil demand increases to slow “to a crawl after 2025, but doesn’t peak until the 2030s at 106 million barrels per day or so.”
Yesterday, California Governor Gavin Newsom announced that the state will phase out sales of all gasoline-powered vehicles by 2035. As Governor Newsom said in a separate event with Democratic governors yesterday, people have climate “goal fatigue” and are ready for the application of those goals–this move on gas-powered cars walks the walk on California’s ambitious […]
H/T to renews.biz, an energy news platform, for that headline, and to PepsiCo for making it possible. PepsiCo, one of the largest companies in the world — with a global carbon footprint — announced plans this week to transition to 100% renewable electricity across all of its company-owned and controlled operations globally by 2030 and […]
Why This Matters: Methane leaks are dangerous — they have led to reports of tap water catching fire, toxic groundwater, and fatal explosions, all of which have been motivators for the federal government to track and seal these wells.
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