How Much Oil Could EVs Feasibly Displace by 2040?

I've been seeing a lot of chit-chat about how much oil EVs could displace on various forums, but most of it is a collection of nonsense, and I'm not sure we all understand all the variables well enough, so this would be a good place to get some oil expert number crunchers to chime in. Here's a good starting point: 

https://oilprice.com/Energy/Energy-General/EVs-Could-Erase-7-Million-Bpd-In-Demand.html

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Looking forward to having someone crunch the numbers.

7.3 million bpd from light duty vehicles alone by 2040 is an impressive figure - you would think the trucking and electric bus market would be bigger again....

What's often overlooked is that petrochemical demand is set to soar - so it's more a shift in demand than a collapse in demand.

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Oxford study foresees that global transition to EVs will cause slash of oil company income by $19 trillion by 2040 which could again cause oil fall to $32 a barrel in 2040 as demand weakens. I would love to see that even I doubt this collapse in demand will happen. 

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(edited)

The main variable is the size of tle EV fleet by 2040 and it's not easy to forecast. As you can see on the chart below the IEA, OPEC, Exxon, BP and Bloomberg Energy Finance have very different forecasts.

But they have something in common : each year the forecast is higher.  The trend is a shift to EVs sooner than expected.

 

 

Depending on the forecast you base your calculations on the amount of oil displaced will be more or less higher.

image.thumb.jpeg.eb920b35c3200f8ee611db79ae9ef6e1.jpeg

Edited by Guillaume Albasini
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EV sales are not just difficult to forecast, they are impossible to forecast, but one thing can be said for certainty - they depend largely on government intervention. About 40 per cent or so of new cars being sold in Norway (a big oil exporter) are electric, but that is due to very substantial subsidies by the government. In fact almost all cases of EV sales success can be attributed to government intervention of some kind. When government intervention/subsidies are withdrawn, sales collapse. This has been the case in China and Denmark - two cases that I can think of off-hand. Apart from a wealthy, green conscious fringe - the sort that orders Tesla 3s - there does not seem to be a natural market for them. No amount of activists pointing to savings in petrol has changed that to day.    

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17 minutes ago, markslawson said:

EV sales are not just difficult to forecast, they are impossible to forecast, but one thing can be said for certainty - they depend largely on government intervention. About 40 per cent or so of new cars being sold in Norway (a big oil exporter) are electric, but that is due to very substantial subsidies by the government. In fact almost all cases of EV sales success can be attributed to government intervention of some kind. When government intervention/subsidies are withdrawn, sales collapse. This has been the case in China and Denmark - two cases that I can think of off-hand. Apart from a wealthy, green conscious fringe - the sort that orders Tesla 3s - there does not seem to be a natural market for them. No amount of activists pointing to savings in petrol has changed that to day.    

 

Subsidies are needed to boost EV sales now because EV are more expensive than ICE cars. But with the falling price of batteries EV's could be cheaper than ICE counterparts by 2025 without subsidies. Will you still buy an ICE car if you can get a cheaper, cleaner, more reliable, more silent, easier to drive car ?

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It is always difficult to shift conservative consumers from Fossils fuels to Electric Vehicles. And these shifts are not possible without Government Intervention and now most of the countries are very conscious about climate changes and the efforts from international organizations boost it globally. But Yes!! Forecast is little difficult...some countries put their target to convert their Conventional Vehicles to EV's..

And it also depends on Future oil prices because Higher oil prices can also helps to push EV's and shifts demand on cleaner fuel, As above mentioned that prices of batteries is also falling, there is many circumstances that could boost EV's in future...

about oil 7.3 million bpd forecast is really a magnificent figure...

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If we take the middle range of those estimates in the chart above (250 million EVs in 2040) and assume the average ICE vehicle replaced drive 15,000 miles per year and gets 35 miles per gallon, then demand is lower by about 7 Mb/d, than the alternative where no EVs are sold.  The problem is that C+C output has been increasing by about 800 kb/d each year on average from 1982 to 2017 (linear trend).  If we make the simple assumption that that trend continues, we have 0.8 times 23 or an 18.4 Mb/d increase in demand (81+18=99 Mb/d of C+C demand).

If oil output peaks as I foresee in 2025+/-2 at about 85+/-2 Mb/d, then output is likely to be far short of demand as C+C output is likely to have fallen to about 79 Mb/d by 2040, so demand would be 99-7=92 Mb/d and we would be short by 13 Mb/d.  Even the most optimistic scenario in the chart above only reduces demand by 14 Mb/d, still leaving us 6 Mb/d short in 2040, though better fuel efficiency for the rest of the light vehicle fleet as well as the bus, truck, and jet fleet may get supply and demand to match.

Oil scenario below

oilshock1805b.png

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Responders to my post have said that if electric cars are subsidised now they will become cheaper, due to increases in volumes. Sure they will become cheaper, but the Tesla 3 is still twice the price of basic car in Australia and is having all sorts of production problems. I believe the Leaf is in the same price category. If prices come down, will consumers bother with them? This is hard to say, but new, base-level petrol cars are cheap (assuming they are no EV subsidies), very reliable, easy to drive, fairly cheap to run despite higher petrol prices, and there is no concern about finding charging stations. Again it is difficult to see just what marketing edge an EV would have in mass markets.  

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More than the increase in volumes, the reason EV will become cheaper is the falling price of batteries.

Now the price of an EV is higher than a similar ICE because the battery is expensive. So it needs subsidies or incentives to compete.

But with the falling price of batteries the production cost of EV's will decrease in the years to come. The need for a subvention will disapear and EV's will be even cheaper than ICE's even without subventions.

So the edge will be the price combined with the fact that EV's will be more reliable (less moving parts in the motor), cleaner, and easier to drive.

And the growing oil price could be also a big incentive to shift to EV's.

 

image.thumb.png.9d229fbc7bcd77b16c89a9b297ee0131.png

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GA - let's go over your points.

"Cleaner" - consumers wouldn't notice the difference, and very hard to tell from outside certainly. There may be an effect in certain smog-prone areas, but it would be collective one. Individual consumers would not notice it.

"Easier to drive" - I puzzled over this one. Then I thought you must be referring to manual transmission ICE cars. Granted there would be a difference for those that still use manual transmission, but what proportion of the market is that? In Australia almost all new cars are automatic. No difference, no edge.

"More reliable" - a marginal effect in a new car. Again too small to make any real difference. There may be more of a difference as the  cars age  but what is the life of a battery pack? The market for second hand EVs is still very small so it's hard to say, much about this. In any case, tyres and brakes still wear out.

And you've overlooked the disadvantages notably range, which is still a major problem in EVs, particularly if you want to use the heating/cooling systems, which are no trouble for an ICE. Again, sorry, but it is difficult to see what edge an EV would have.

As for price. Sure prices will come down, if we are prepared to pay big subsidies now. I was under the distinct impression that problems with ramping up battery production but no matter. The point is that EVs will have to be subsidised big time and still face, overall, disadvantages in the eyes of consumers.  Anyway, leave it with you. 

 

 

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"Easier to drive" - In Australia and the US almost all new cars are automatic but it's not the case in the rest of the world. In Europe and Japan more than 80% of the cars are with manual shift.

"More reliable" - EV models are usually more reliable than the equivalent ICE models. The Chevrolet Bolt EV, which scored “Very Reliable” in the Consumer Reports’ latest Annual Vehicle Reliability survey  despite only being available for the past year or so is Chevrolet’s most reliable of fifteen vehicles made.

https://transportevolved.com/2017/10/23/are-electric-cars-more-reliable-than-gasoline-vehicle-overall-yes-says-consumer-reports/

So if you have a car that is cheaper and cost less in energy and repairs the economic edge will be stronger.

 

The disadvantages like the scarcity of charging stations or the time needed to charge will not last forever as the charging stations netwoork is expanding and new technology will reduce charging time.

https://insideevs.com/bp-invests-in-storedot-firm-promises-charging-as-quick-as-fueling/

 

 

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I think the discussion is too simplistic as the assumption is that the only alternative to ICE vehicles will be battery operated EVs.  This may not be the case and, of course, we cannot predict the future, certainly not the future of technology.  Therefore, it could be that some other alternative power source will be developed for vehicles, perhaps fuel cell or hydrogen.  One thing is for certain, purely ICE vehicles are near the end of their life cycle, this is old technology and one that has been pretty much developed as far as it can go.  There is a need a for a less polluting, viable alternative to ICE vehicles and I believe with government intervention the car companies have the money and technology to develop viable alternatives.  The fundamental requirements of these alternatives will be usability, which will depend on range between fill ups or recharging, cost of ownership and the support of a service network, such as recharging points and maintenance locations.

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People don't seem to be considering the limitations of EV like infrastructure bottlenecks, slow charge, insufficient lithium reserves etc. Also, the charging of the cars will require coal based power for seamless power supply.

 

The most important factor will be that most of the vehicles are goods vehicles which travel long distances and work continually wthout break (for charging). These vehicles can't be replaced with EV vehicles

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Battery operated EV's is not the only alternative to ICE but its the one the car manufacturers are predominantly adopting now. Hydrogen wil play also a role in the coming years but I think it will be more for heavy or long range vehicles (trucks, ships, planes).

But you are right to say that we cannot predict the future of technology and we tend to base our predictions on some assumptions that could be false.

For instance we are talking about charging stations and battery size. But what if instead of having to stop to charge the car, the car will charge directly on the road ? The technology is already being tested :

https://www.theguardian.com/environment/2018/apr/12/worlds-first-electrified-road-for-charging-vehicles-opens-in-sweden

The range will be virtualy unlimited and the battery size could be reduced to be used only when the car go out of the grid of charging roads.

 

 

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3 hours ago, Guillaume Albasini said:

Battery operated EV's is not the only alternative to ICE but its the one the car manufacturers are predominantly adopting now. Hydrogen wil play also a role in the coming years but I think it will be more for heavy or long range vehicles (trucks, ships, planes).

But you are right to say that we cannot predict the future of technology and we tend to base our predictions on some assumptions that could be false.

For instance we are talking about charging stations and battery size. But what if instead of having to stop to charge the car, the car will charge directly on the road ? The technology is already being tested :

https://www.theguardian.com/environment/2018/apr/12/worlds-first-electrified-road-for-charging-vehicles-opens-in-sweden

The range will be virtualy unlimited and the battery size could be reduced to be used only when the car go out of the grid of charging roads.

 

 

The on-the-road charging would be a massive infrastructure shift, and would likely start in the cities--with rural areas not even close to economically viable. Here in Michigan we can't even keep our roads drivable under the hot-then-freezing-then-hot-and-freezing-again conditions, let alone expensive infrastructure that would allow everyone to drive on them and charge their EVs. 

The thing about ICE is that they are usable for everyone (and I personally prefer manual transmission--it's not seen as a disadvantage anymore--the people who drive manual transmissions do so because they are simply more fun to drive unless you're a smoker and a coffee drinker, which is almost impossible to do whilst shifting). The problem with EVs is that--at least now and in the near future--they are not usable for everyone. Is Tesla making a 4-wheel-drive 8-passenger utility vehicle? If not, then this will not work for me nor for a large segment of rural America. My driveway is not conducive to non-4-wheel-drive vehicles, and neither are the back roads (and hello, we have a plethora of dirt roads around here. Are we going to put charging infrastructure on those too, when it doesn't make economical sense to even pave them???) And in Michigan, there is also NO WAY to function without running the heater--a significant drain on the battery.  And what happens to an EV battery when it's 20 below? The range is substantially reduced in cold weather, and I'm thinking they just mean "cold weather", not 20-below weather. 

This is my normal rant about EVs. There will always be a market for ICE vehicles because EVs can't do what everyone needs them to do--they can do what city folk need them to do. Great for the city folk. As the democrats learned during the last election, you ignore rural America at your peril. A majority of forecasts for EVs are, I think, out of touch with reality.

I say this because the EV market or its effect on oil needs to take into account more than just math. We can't forget about the practicality.

That said, there is a place for EVs. Just not here.

 

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(edited)

Evs and autonomous vehicles will probably displace around 30 mbd of demand by 2030, at least according to RethinkX and their report on energy disruption https://www.rethinkx.com/

 

Analysts are updating their forecasts fast, last year Bloomberg saw peak oil demand coming by the mid 2040s and this year they see it coming by 2030. They will probably update their forecasts to an even sooner date.

https://www.bloomberg.com/news/articles/2018-02-20/bp-sees-electric-future-with-oil-demand-peaking-in-2030s

 

Edited by JunoTen
more precision
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On 5/22/2018 at 4:37 PM, Guillaume Albasini said:

The main variable is the size of tle EV fleet by 2040 and it's not easy to forecast. As you can see on the chart below the IEA, OPEC, Exxon, BP and Bloomberg Energy Finance have very different forecasts.

But they have something in common : each year the forecast is higher.  The trend is a shift to EVs sooner than expected.

 

 

Depending on the forecast you base your calculations on the amount of oil displaced will be more or less higher.

image.thumb.jpeg.eb920b35c3200f8ee611db79ae9ef6e1.jpeg

There is one thing to point out regarding these forecasts, 3 of the 5 organizations/companies are heavily involved with oil and even BP in their latest forecast foresees EV going past 300 million by 2040 and OPEC is not too far off (270 million +/- 5 million). And since they get nearly all their revenue from oil, we should see these forecasts on the conservative side, relative to BNEF on the optimistic side for electric cars. 

Also, these forecasts do not even take into account, (or are just starting to) self-driving cars. Which this article goes more into detail (https://spectrum.ieee.org/cars-that-think/transportation/self-driving/rethinkx-selfdriving-electric-cars-will-dominate-roads-by-2030) right here. However, given with how fast technology is advancing with these self-driving cars, it is just a matter of months before Waymo and GM Cruise reach level 5 automation (drive by themselves without pedals or a steering wheel). And one last note at the battery costs, Bloomberg thought we would hit $200/kwh by 2019 in their 2015 forecast, but we have hit that figure two years earlier than projected ($209/kwh fo 2017, but close enough) (https://www.bloomberg.com/news/articles/2017-12-05/latest-bull-case-for-electric-cars-the-cheapest-batteries-ever). I know there is a lot of other variables to cover and we can not get through all of them, but one thing is for certain, technology and its rate of development is accelerating faster than perhaps we as a society can imagine, let alone comprehend.

image.png.1a2fd3244fbbe07e163e432ee695a177.pngvs.  698x-1.png

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if EV electricity still come from natural gas powerplant, you are just shifting emissions from car to powerplant unless you dump back equivalent CO2 into gas well. or unless electricity comes from renewable like solar & wind and maybe tidal wave 

also, unless i am mistaken, EV Li+ battery still have limited range per full charge...165 miles. not exactly practical except for only city drive. 

 

if you can fully charge these Li+ battery in say less than 10 minutes, wouldn't this significantly reduce these battery lifespan? 

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i am not sure how ignorant the users here. no one discusing about Autonomous cars. 1 autonomous car = 10 normal cars. Waymo already ordered 20k cars for 2020. Just assume if 5 more companies enter into this field with  5 lakh each by 2023.  thats like 10 million normal cars equivalent of oil  consumption - thats like 10 crore barrels per year or 3 lakh barrels per day will be saved by only for autonomous ride sharing cars

PLUS

Electric trucks + Buses - 5 lakhs by 2023 equals to 0.5 million barrels

my guess -  million barrels less demand only in USA. and 2-3 million barrels less demand for remainng world by 2023

total 3 million barrels less demand by 2023

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53 minutes ago, Bharath said:

i am not sure how ignorant the users here. no one discusing about Autonomous cars. 1 autonomous car = 10 normal cars.

can you walk we ignorant folk through that math? 

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I suppose Bharaith had in mind autonomous and shared cars. A kind of taxi or Uber without human drivers.

A usual car is on the road for one or two hours a day and stays the rest of the day on a parking lot. But an autonomous and shared car would be on the road all the day. So instead of 2 hours it could be on the road 20 hours a day  using 10 times more energy than a usual car.

 

As you know I'm rather optimistic about the rise of EV's and think the EV market share will ramp up faster than expected.

But for autonomous cars I'm way more cautious and I think it will take more time than expected. It's rather complicated to mix on the same roads autonomous and human driven vehicles and many challenges are still to be adressed.

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27 minutes ago, Guillaume Albasini said:

I suppose Bharaith had in mind autonomous and shared cars. A kind of taxi or Uber without human drivers.

A usual car is on the road for one or two hours a day and stays the rest of the day on a parking lot. But an autonomous and shared car would be on the road all the day. So instead of 2 hours it could be on the road 20 hours a day  using 10 times more energy than a usual car.

 

As you know I'm rather optimistic about the rise of EV's and think the EV market share will ramp up faster than expected.

But for autonomous cars I'm way more cautious and I think it will take more time than expected. It's rather complicated to mix on the same roads autonomous and human driven vehicles and many challenges are still to be adressed.

ahh... good ol' carpooling. The stats on that are not so great. https://www.michigan.gov/mdot/0,4616,7-151-9615_11234-22209--,00.html . Sharing a ride is convoluted and woefully inconvenient.

 

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(edited)

so "autonomous" car no need energy? driven by god?? calling ppl ignorant?? what is our topic about? it is about EV!!! Nothing to do with fucking autonomus car!!!

Edited by Alvin Lee
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Is autonomous car powered by infinity stone that it needs no oil? How does it matter if it is one car running for 20 hours or 10 cars running for 2 hours each? The oil consumption will be the same. Also, how is autonomous car better than say carpooling in Ola/Uber? Why are you upset at the driver?

On 5/25/2018 at 8:27 PM, Bharath said:

i am not sure how ignorant the users here. no one discusing about Autonomous cars. 1 autonomous car = 10 normal cars. Waymo already ordered 20k cars for 2020. Just assume if 5 more companies enter into this field with  5 lakh each by 2023.  thats like 10 million normal cars equivalent of oil  consumption - thats like 10 crore barrels per year or 3 lakh barrels per day will be saved by only for autonomous ride sharing cars

PLUS

Electric trucks + Buses - 5 lakhs by 2023 equals to 0.5 million barrels

my guess -  million barrels less demand only in USA. and 2-3 million barrels less demand for remainng world by 2023

total 3 million barrels less demand by 2023

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