A larger-than-expected boom in electric vehicle sales could cause global oil demand to peak and flatten out in the late 2030s, OPEC said.
If a quarter of the world’s cars have batteries, global oil demand would reach a plateau of about 109 million barrels a day during the second half of the 2030s, the Organization of Petroleum Exporting Countries said in its annual World Oil Outlook.
The group’s main forecast is still for consumption to increase for decades to come as the electric car fleet expands at half that pace. Yet the inclusion of the faster-growth scenario shows they are starting to take the threat more seriously.
“It is highly unlikely that electric vehicles will penetrate the passenger car segment with this strength in less than 24 years,” according to the report published on Tuesday. “Nevertheless, several countries have publicly stated their intention to achieve an even higher share of electric vehicles in new sales.”
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After France, the U.K. and potentially China announced plans to ban the sale of fossil-fuel burning cars in the coming decades, oil producers are paying increasing attention to the impact on long-term growth in oil demand. So far, there is little agreement over the scale of the threat. The International Energy Agency sees about 8% of the global light vehicle fleet running on batteries by 2040 with little impact on oil use, while Bloomberg New Energy Finance forecasts that a third of cars on the road will be electric.