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Why Global Demand for Oil Will Steadily Decline

August 5, 2013, 2:46 PM
Oil

What's the Latest Development?

With global population still on the march, and developing economies like India and China brining potentially billions more drivers onto the roads, demand for oil as a source of energy may actually decline in the years ahead. Natural gas mined from beds of shale rock "could replace oil in ships, power stations, petrochemical plants and domestic and industrial heating systems, and thus displace a few million barrels of oil a day by 2020." Advances in automotive technology, which are improving fuel efficiency rates and making renewable fuels economical, will also be enough to constrain oil demand.

What's the Big Idea?

Beyond the environmental dividends paid by a world less reliant on fossil fuels, global politics may benefit as totalitarian regimes propped up by obscene oil revenues loose their means of maintaining military control and of pacifying civilian populations. "The Kremlin will find it more difficult to impose its will on the country if its main source of patronage is diminished. The Saudi princes have relied on a high oil price to balance their budgets while paying for lavish social programmes to placate the restless young generation that has taken to the streets elsewhere."

Photo credit: Shutterstock.com

Read it at the Economist

 

Why Global Demand for Oil W...

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