Oil: Peak Demand Thoughts

I think the general time frame for the peak demand argument ranges from the early 2020s to the 2040s. A wave of news has recently hit with countries and cities pledging a variety of bans on the internal combustion engine. Per this Reuters link:

"Paris, Madrid, Mexico City and Athens plan to ban diesel vehicles from city centers by 2025."



France and the UK have also pledged to ban gas and diesel vehicle sales by 2040. China and India also want to move in this direction.

Even Volvo has gotten in on the hype by pledging to only manufacture all hybrid or electric vehicles by 2019.

I think there are some finer points to consider on these plans. In the Reuters article, the UK mentions that this ban on diesel and gas vehicles would not apply to hybrids. Hybrids do get better gas miles, but to me that doesn't seem to imply that new vehicles in the UK will no longer use gas by 2040.

As for China, why would it consider buying up to 5% in Saudi Arabia's Aramco IPO, if they were seriously considering an aggressive move towards ending the internal combustion engine. If peak demand really does hit by the early 2020s due to the push to end the internal combustion engine, isn't China wasting their money?

And for the quote I used, I think the key word is "plan." A plan is not a law, at least not yet.

Technological advances will obviously impact how quickly we get to peak demand, as well. One of the biggest issues that seems to be discussed is improvements in battery/storage.

Am I buying into the argument that we'll be hitting peak demand at some point in the future? Yes; however, I suspect peak demand is more likely to be closer to the 2040s vs the early 2020s.