ExxonMobil produced a report on Monday that anticipated oil demand reaching a “plateau” in 2030 and remaining fairly stable for the next 20 years — a prediction far out of line with political narratives of a “transition to green energy.”
ExxonMobil’s “plateau” of oil demand was calculated at 102.2 million barrels per day, which is roughly what global demand worked out to last year. The report predicted this equilibrium would be maintained by the developing world dramatically increasing oil consumption while the U.S. and Europe scale back their demand.
The overall vision of the report was a much slower, more limited, and more realistic “transition” than environmentalist politicians have demanded.
If the report’s projections are correct, the world will still be getting more than half of its energy from fossil fuels by 2050, but emissions will decline by 25 percent thanks to cleaner and more efficient methods of burning those fuels.
“Renewables will play an important role. So will oil and natural gas,” ExxonMobile predicted.
Coal also reportedly has a key role to place despite being one of the fuels most despised by the climate change movement. The report envisioned oil and gas providing 54 percent of global energy by 2050, followed by “renewables” (wind, solar, and hydropower) at 15 percent, then coal at 13 percent. The top five energy sources were rounded out with bioenergy at ten percent and nuclear power at six percent.
Bioenergy is, for the most part, plant matter converted into liquid fuel – ethanol and methane derived from the manure of herbivorous animals, for example.
One reason for growing interest in bioenergy is that it can be combined with coal burning to maintain the energy output of coal with lower emissions. This is also one reason environmentalists are turning sour on bioenergy, combined with their belief that it releases too much carbon into the atmosphere, driving climate change. Coal plus bioenergy hitting 23 percent of global power generation in 2050, while oil and gas continue to account for more than half, is not the “energy transition” climate activists had in mind.
ExxonMobil’s prediction for oil demand was notably higher than that of rival BP, which projected demand of just 75 million barrels per day (versus ExxonMobil’s 102 million) in a similar report produced this year.
Both of those projections are far higher than the International Energy Agency’s (IEA) vision of 55 million bpd consumption in a truly climate-sensitive 2050. However, even ExxonMobil’s bullish forecast is lower than that of the Organization of the Petroleum Exporting Countries (OPEC), which said oil demand will reach 116 million bpd by 2045.
ExxonMobil analysts were quite insistent that BP got it wrong, and the IEA is simply daydreaming. The Texas oil company warned politicians and investors that making plans based on less than 102 million bpd consumption – or using raw political power to try forcing demand below that level – would result in a global oil shock, potentially increasing the price of crude oil by 400 percent or more.
The IEA, on the other hand, insisted in June that world oil demand will plummet in the coming decades, and producers will create a “staggering” surplus if they do not reduce their output accordingly.
Environmentalists derided ExxonMobil and OPEC for predicting stable or growing demand for oil and gas, painting them as selfish corporations generating propaganda to keep investor money rolling in.
The oil company and cartel, on the other hand, say the IEA’s demands are absurd – people in advanced economies simply will not accept the primitive standard of living required to meet them – and lower forecasts like BP’s are failing to take proper account of the demand for energy in developing nations. Unlike most of the West and industrialized Asia, those nations still have rapidly-increasing populations, and fossil fuels are their only affordable means of increasing both their industrial capacity and standard of living.
It should be noted that developing nations are much more inclined toward ExxonMobil’s view. The BRICS economic bloc, which is dominated by Russia and China but includes a growing number of developing nations as members and aspirants, has made it abundantly clear that it will not sacrifice its industrial goals on the altar of reduced emissions or climate change.
BRICS members have stated they view climate change as a First World problem, to be solved entirely through spending and sacrifices by First World nations.
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