The world’s oil companies are taking a hit due to the early adoption of electric modes of transportation and their increasing popularity.
A recent Bloomberg study indicates that EVs are removing around one million barrels per day of oil consumed around the world. Although this figure is only 1% of the 100 million barrels per day consumption rate from 2019, it is the beginning of an inevitable transformation to a global clean energy economy.
Interestingly, most of the impact of oil consumption is not coming from the market adoption of electric cars, but from two and three-wheeled vehicles powered by electric batteries – which all together are beginning to impact commercial oil use on a global scale.
Interestingly enough, scooters and other small-scale forms of personal; electric transportation are displacing more oil and contributing to positive environmental awareness on a larger scale than luxury electric cars.
Bloomberg’s Nathaniel Bullard stated that electric bikes, trikes, and scooters are disrupting global oil consumption on a massive scale. In 2020, so far, this category of electrified transportation has accounted for around 60% of avoided oil consumption.
In a year that has been especially harsh to global automotive sales due to the COVID-19 pandemic, oil consumption is already at a low. Bloomberg’s analysts also foresee a 23% decline in the sales of internal combustion engine vehicles this year.
The two areas where the vast majority of the displacement of oil usage is concentrated is the United States and China; the two largest automotive markets in the world.
These two countries (markets) also account for a greater overall environmental and economic benefit through the widescale adoption of electric vehicles than most other parts of the world, and offer local incentives and government subsidies in most areas, one exception: Hawaii.
It is evident that the pandemic, combined with the emerging electric transportation sector is causing significant disruptions in Big Oil plans.