(Bloomberg) – BP Plc said the relentless growth of oil demand is over, becoming the first supermajor to call the end of an era many thought would last another decade or more.
Oil consumption may never return to levels seen before the coronavirus crisis took hold, BP said in a report on Monday. Even its most bullish scenario sees demand no better than “broadly flat” for the next two decades as the energy transition shifts the world away from fossil fuels.
I don't see demand increasing until there is a widely available Vaccine. People will be working remotely, not many will be flying, etc.... I also don't see Russia, Saudi and other OPEC nations agreeing to substantial production cuts as their economies struggle. Everyone's guess as to what will happen is as good as the other but the signs certainly indicate a grim future for O&G until the end of 2021.
Ever think BP’s “report” is biased to justify their net zero pivot, so their investors have to s— up a lower utility-like return (8%) v. oil and gas returns (15%), and just accept the lower dividend - see Bloomberg articles on this. It is just smoke and mirrors, if not self-dealing. Other operators see through that for a long term future of oil and gas.
this rodeo started winding down when lesar and the board wrote a $3.5 Billion check to BHI.
the traditional O & G energy industry - while essential - is rapidly becoming archaic.
adapt or die.
So I left the industry about 4 years ago so I don’t have any skin in this and I think I can offer an unbiased opinion. Demand will certainly rebound substantially from where we are now. Flights will start up again and many more people will begin to trickle back into the office, thus driving more. It’s going to take several more months likely - but it will happen.
Electrification of cars is prob the single biggest threat. However, my thought is (at least short term) that energy will come from natural gas. Also, the petro cars out there now aren’t going to just disappear. My bet is the industry has permanently shrank but it’s not dead.
I don't know about that. I imagine that demand will recover in 2021 to at least 50% more that we see today. Which is still pretty bad.