OPEC projects EV penetration to reduce oil demand

According to analysis released by the Organization of Petroleum Exporting Countries, faster penetration of electric vehicles (EVs) could reduce oil demand to 108 million barrels a day (mb/d) by 2040. The estimate, when focused on the penetration of EVs in the passenger car segment, assumes that annual EV sales will reach 80 million by 2040. Under the assumption that the increasing EV penetration in the passenger car segment spreads to commercial vehicles, oil demand in 2040 is reduced by 2.5 mb/d, the analysis found. Global oil demand is estimated to plateau around this level in the second half of the 2030s. The larger part of this reduction, around two thirds, is assumed to take place in developing countries, where a higher potential for efficiency improvements exists. Assumed efficiency improvements in China would translate into some 0.6 mb/d lower oil demand than in the reference case used in the analysis, while India contributes another 0.3 mb/d. Because of the high overall level of oil demand in the group of other developed countries, the potential demand reduction in this region is more than 1 mb/d.