A group of Bank of America analysts believe that worldwide demand for oil will start to drop, rather than continue to increase, by 2030, reports Automotive News. The reason for the shift is electric cars. This is in direct contrast to what the International Energy Agency said in November.
Industries such as heating and power generation, have already moved away from oil as a fuel source, leaving gas and diesel powered vehicles as the last major holdout. But electric cars are expected to proliferate rapidly in coming years, reducing the demand for such fuels as well as lubricants. As electric car sales begin to take off over the next several years, Bank of America's analysts expect oil demand to level off quickly, then decrease as electric cars start to outnumber gas and diesel cars on our roads.
This direct connection between the number of electric cars on the road and oil demand is fairly obvious, but what is less obvious is their prediction that this will happen in just 12 years from now. According to FleetCarma, electric vehicles accounted for just 1.07 percent of all auto sales in the U.S. in 2017. This varies from place to place. For instance, in California, EVs make up 5 percent of new car sales. But the point is that while it's no longer uncommon to see an EV like a Tesla or a Chevy Bolt in traffic, they're not exactly displacing the ever-popular Ford F-150 in sales numbers, either.
But this is just the beginning. The Tesla Model 3 is beginning to roll out. Volkswagen is gearing up for a huge EV push that could not only reinvent the company but the entire automotive market if successful. As EVs become more common, prices will come down as the technology gets less expensive and more established. Ranges over 200 miles are becoming common, which is enough for most daily commutes. Once a reasonable charging infrastructure is in place, there will be little reason for most people to keep a gas or diesel vehicle around unless they have very specific needs that require it.
It may not feel like it, but we might just be watching the beginning of the end of fossil fuel powered vehicles right here, right now.