Quote:
Originally Posted by Mr.Coffee
I think the big disconnect could be- oil could peak then (as in demand could peak) or decline but are you guys suggesting that oil demand collapses or there’s then nobody to sell oil to?
I just had a hilarious conversation with ChatGPT about it. Wolven the Coles notes was a range of demand dropping ~10% by 2036 or increasing ~1-2%.
Complicated to forecast for sure due to the bazillion variables. Regardless I’m willing to take that bet that oil will be used in 2036 and there’ll be customers for decades.
|
No, you are confusing peak oil demand and total oil demand.
Oil will still be used in 2036, the point is that if demand starts going down then we shouldn't be investing a lot of money to try to make our supply go up because we won't earn our money back.
We should still sell our oil and we should move ahead with optimizing the existing pipelines ASAP to get more oil to market in the near term. The more time we waste talking about the imaginary pipeline project and not optimizing TMX is wasted opportunity to sell oil. We need to make money while we can.
At the same time, we need to understand that electrification replaces fossil fuels in many ways and electrification is not slowing down. Not only are many countries investing in electrification today they are also investing in innovations that make electrification cheaper and more effective. Those innovations will be in mass production in 10 years and will further harm the ROI on a new pipeline.
And yes, you are right in that there are many variables. Like if the Saudis decide to maximize their profits for the next 20 years and sell all of their oil. They could crush the market by unloading their oil (essentially cashing out). There is no way to forecast that, they can just do it whenever they want and most Albertans know what happens to the Alberta oil sector when the Saudis unload their oil.