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Originally Posted by burn_this_city
No one knows what future oil demand will be. Shell and BP are taking a stab in the dark in the middle of the pandemic. Overall the industry knows we're at the sunset phase, whether that phase is another 10 or 20 years is anyone's guess. We also don't know what demand will fall to, if it's only a decline of 15-20% of demand, that's still 80-85 MBPD, which is where demand was 10 years ago.
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We have a pretty good idea the direction demand is going to go. If you can't read the tea leaves being left behind by policy makers around the globe, the producers of the product themselves, then the industries that rely on fossil fuels for the sustainability of their products, then you aren't paying attention.
When California - the 5th largest economy on the planet - is taking radical steps to shift away from the
use of fossil fuels, it is a bellwether moment. When the same body pushes for the
elimination of ICE vehicles by 2035, that is a statement that needs to be acknowledged and then understood for its impact around the United States and the world. You have to understand the power
California wields when it comes to emissions and green policy, and how that impacts the entire industry and market.
Car manufacturers get it as well. When they negotiate with, and agree to,
California's emissions standards, it is another key factor to acknowledge. Manufacturers see the writing on the wall and they are doing everything they can to
get ahead of the impending shift on the horizon. They have to respond to no only policy, but
consumer demands. The
luxury market is already there and the mid and economy markets are not far behind. Manufacturers are
struggling to keep up with demand.
You also have to look at the producers themselves. Saudi Arabia did an
IPO for Aramco to establish a massive fund to
shift their economy away from O&G and look to other means of
maintaining their economic condition in a post-oil world. If this is not enough of a wake up call I don't know what people are looking for.
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Biden isn't dumb to say he will begin the transition and phase things out, seems like its basically a foregone conclusion at this point.
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Exactly. The adults at the table understand the challenges ahead and can speak to them with wetting their pants. It is okay to state the obvious. Some require more context, but it doesn't change a thing about this being an absolute necessity and something that is going to happen sooner rather than later.