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Yahoo
19-06-2025
- Automotive
- Yahoo
Why Forecasters Can't Agree On When Oil Demand Will Peak
Oil demand is set to plateau rather than drop off a cliff after it peaks, the International Energy Agency (IEA) predicted this week, citing 'policy settings and market trends.' But here's the thing about policy settings and market trends: they change. That oil demand is set to peak before 2030 has been repeated ad nauseam by various forecasters, including, notably, Chinese energy majors Sinopec and CNPC. Indeed, OPEC is the only forecaster of demand that does not see it peaking anytime soon. Of course, OPEC is interested in its predictions panning out—but so is the IEA, a vocal proponent of the shift to electrification in transport and moving from hydrocarbon-fueled baseload generation to weather-dependent wind and solar, as are many governments of large oil consumers. When the IEA cited those 'policy settings and market trends' in its latest Oil Market Report and its Oil 2025 report, which came out together this week, it was that shift to EVs and the move to wind and solar that it meant as drivers of falling oil demand. But there are some challenges facing both assumptions. A recent Shell-commissioned survey found that while existing EV owners tend to feel more confident about their vehicles, many prospective buyers remain hesitant—citing cost as a major barrier. 'While current EV drivers are feeling more confident, the relatively high cost of owning an electric vehicle, combined with broader economic pressures, are making it a difficult decision for new consumers,' Shell's VP for mobility and convenience, David Bunch, said, as quoted by Bloomberg this week. China remains an exception, thanks to extensive subsidies and a highly competitive market that has driven down prices. However, even in China, this model may be reaching its limits. 'It's very extreme, tough competition,' an executive vice president of BYD told Bloomberg. 'No, it's not sustainable,' Stella Li added, referring to the current situation in China's electric car sector. The most likely prospect is consolidation. And that may put a stop to the continuous decline in prices. Despite this, many oil demand forecasts—including the IEA's—still rely on projections of steady EV growth. But recent industry decisions suggest a more complex picture. GM announced it would invest $4 billion in expanding internal combustion engine vehicle production. Volvo Cars, which reported strong EV-driven sales last year, saw a 12% drop in overall sales this May, in part due to underperformance in its EV segment. These developments reflect growing pains in the transition—not necessarily a reversal, but perhaps a recalibration of expectations. If one of the largest U.S. automakers is tempering its EV ambitions, it raises the question: how many others might adjust course, especially if EV profitability continues to lag behind that of ICE vehicles? Then there is the issue of 'policy settings.' In this respect, Europe is perhaps the best example of trying to go against nature and suffering adverse consequences. Here, we have the European Union's and the UK's leadership bent on having an energy transition whether anyone wants it or not, up to and including, in the UK's case, decimating local oil and gas production in favor of imports of both, plus electricity. In the EU, the leadership is discussing a ban on any oil products that may have been produced from Russian crude oil—when the EU is a major importer of oil derivatives from Asia, which in turn features the two biggest buyers of Russian crude, China and India. The IEA and most other forecasters are quite certain that this sort of energy policy would ultimately lead to lower oil demand. That's despite the fact that the UK's extremely pro-transition government conceded the country still needs North Sea oil and gas so they limited their efforts to ban it to new exploration only. It's also despite the fact that Austria has joined Slovakia and Hungary in opposing a total ban on Russian gas imports—after the EU booked a record in LNG imports from Russia last year. However, on the ground, as it were, reality keeps shattering these visions, and oil demand remains strong. Naturally, economic trends and events such as inflation and tariffs affect demand negatively when they go up. This has always been the case and always will be, when it comes to oil. But the fact that prices surged immediately after Israel launched missiles at Iran last Friday shows quite clearly that the world is still as hooked on crude as it has been for a century. One might argue that it was a knee-jerk reaction on the part of traders given that Iran is the third-largest crude producer in OPEC with over 3 million bpd in output. One might extend this argument to include OPEC's oft-cited spare capacity that amounts to some 5 million bpd. However, a counter-argument could also be made, namely, that prices rose because the market is not as oversupplied as assumed and that it can very quickly stop being well supplied at all. As for OPEC's spare capacity—well, they have to want to use it. By Irina Slav for More Top Reads From this article on
Miami Herald
17-06-2025
- Automotive
- Miami Herald
EVs suffer surprising rejection in a crucial market
Despite over a decade of government subsidies, electric vehicles still haven't taken off in the U.S. Undoubtedly, the segment has grown, due mainly to the popularity of Tesla (TSLA) , but the big automakers are still losing a lot of money on their electric vehicles. Ford, for example, has sold 6.1% more vehicles year to date than it did a year ago. However, the company did this despite selling 25% fewer EVs month to month, accelerating a declining sales trend for a segment of the company's brand that had been experiencing growth. Related: Jaguar Land Rover has big, growing problem on its hands Ford announced last year that its EV division would lose about $5 billion in 2024. The $1.5 billion the unit lost in the third quarter alone was actually an 8% improvement year over year. Meanwhile, back in 2023, General Motors said that despite losing money on EVs, it expected its EV segment to be profitable by this year. So far this year, GM's EV segment has been performing well, with sales more than doubling through the first five months of the year. The company sold 62,830 EVs through May, with Chevrolet driving 37,620 of those sales. This year, Chevy's performance alone has outstripped rival Ford, which has sold 34,132 vehicles across its all-electric lineup. However, the U.S. is only one of three major EV markets in the world. Europe and China have a much larger appetite for electric vehicles, but new data suggests one of those markets is also starting to slow down. Image source: Pool/Getty Images Americans bought 1.5 million EVs in 2023, while the Chinese bought 8.2 million. According to the International Energy Agency, European consumers purchased 3.2 million during the same period. However, a new study by the oil company Shell suggests that consumer sentiment is trending in the wrong direction in Europe. The 2025 Shell Recharge Driver Survey features responses from over 15,000 European drivers. The appetite to buy an EV among internal combustion engine (ICE) car drivers dropped to 41% from 48% last year. Related: Toyota makes surprising move to beat Tesla in key market While the sentiment also fell in the U.S., the 34% to 31% decline was less dramatic. The biggest issue for European drivers is the cost of the vehicles, as 43% of drivers cited affordability as their top issue. Despite falling battery costs, European EV prices have stagnated in recent quarters. A strong plurality on both sides of the pond believes ICE vehicles should be phased out completely. About 46% of ICE vehicle drivers in the U.S. agree with government policies encouraging the phasing out of ICE vehicles, while 44% of European ICE drivers feel that way. "This research reinforces what we hear from our customers: there's a growing disparity in the transition to electric vehicles," said Shell VP of Mobility and Convenience David Bunch. "While current EV drivers are feeling more confident, the relatively high cost of owning an electric vehicle, combined with broader economic pressures, are making it a difficult decision for new consumers." President Joe Biden and his Democrat predecessor saw climate change as an existential crisis and electric vehicles as a key to combating that crisis. Obama initiated the $7,500 EV tax rebate during his term, and Biden expanded the program during his. While it hasn't been a big subject for Trump this time around, he did call some of the rhetoric around climate change a hoax when he first ran for president back in 2015. EVs just aren't as popular in the U.S. as they are in China and Europe. However, hybrid vehicles, which are mainly ICE engines with a small battery backup, are gaining in popularity. Ford hybrid sales increased nearly 30% to 22,719 vehicles in May. Year to date, hybrid sales are up more than 31%. According to Bunch, hybrids could play a key role in ultimately decarbonizing our driving experiences. "With the right policies and industry collaboration, we can make the transition affordable for consumers and attractive for investors. But more must be done to stimulate demand and ensure no one is left behind in the shift to cleaner transport," he said. Related: 10,000 people join crazy Tesla class action lawsuit The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Time of India
17-06-2025
- Automotive
- Time of India
Willingness to switch to EVs fades faster in Europe than US, Shell survey shows
Drivers are becoming more reluctant to switch to electric vehicles from combustion engines and the trend is more pronounced in Europe than in the United States , a survey published by Shell on Tuesday showed. The main obstacle is cost, according to the survey of 15,000 drivers across the world, including Britain, China, Germany and the United States. "Europe surprised us," said David Bunch, Shell's chief for mobility and convenience. "The single biggest barrier to entry is the cost of the vehicle. Range anxiety is still there but it's diminishing." Electric vehicles are on average up to 30 per cent more expensive than internal combustion engine cars. This year, 41 per cent of respondents in Europe said they would consider switching to an electric car compared with 48 per cent last year, while in the United States the number fell three percentage points to 31 per cent, the survey showed. In terms of the pace at which the charging experience is improving, only about half of European drivers said public charging had improved in the last year, below China's 74 per cent and 80 per cent in the United States. Only 17 per cent of European drivers asked said public charging offered value for money, compared with 69 per cent in China and 71 per cent in the United States. Shell runs 75,000 charging points and focuses its EV strategy on fast, on-the-go charging points rather than home-charging. Its core EV markets are China, Britain, Germany, Switzerland , Singapore, the Netherlands and the United States.
Yahoo
17-06-2025
- Automotive
- Yahoo
Willingness to switch to EVs fades faster in Europe than US, Shell survey shows
LONDON (Reuters) -Drivers are becoming more reluctant to switch to electric vehicles from combustion engines and the trend is more pronounced in Europe than in the United States, a survey published by Shell on Tuesday showed. The main obstacle is cost, according to the survey of 15,000 drivers across the world, including Britain, China, Germany and the United States. "Europe surprised us," said David Bunch, Shell's chief for mobility and convenience. "The single biggest barrier to entry is the cost of the vehicle. Range anxiety is still there but it's diminishing." Electric vehicles are on average up to 30% more expensive than internal combustion engine cars. This year, 41% of respondents in Europe said they would consider switching to an electric car compared with 48% last year, while in the United States the number fell three percentage points to 31%, the survey showed. In terms of the pace at which the charging experience is improving, only about half of European drivers said public charging had improved in the last year, below China's 74% and 80% in the United States. Only 17% of European drivers asked said public charging offered value for money, compared with 69% in China and 71% in the United States. Shell runs 75,000 charging points and focuses its EV strategy on fast, on-the-go charging points rather than home-charging. Its core EV markets are China, Britain, Germany, Switzerland, Singapore, the Netherlands and the United States. Sign in to access your portfolio
Reuters
16-06-2025
- Automotive
- Reuters
Willingness to switch to EVs fades faster in Europe than US, Shell survey shows
LONDON, June 17 (Reuters) - Drivers are becoming more reluctant to switch to electric vehicles from combustion engines and the trend is more pronounced in Europe than in the United States, a survey published by Shell (SHEL.L), opens new tab on Tuesday showed. The main obstacle is cost, according to the survey of 15,000 drivers across the world, including Britain, China, Germany and the United States. "Europe surprised us," said David Bunch, Shell's chief for mobility and convenience. "The single biggest barrier to entry is the cost of the vehicle. Range anxiety is still there but it's diminishing." Electric vehicles are on average up to 30% more expensive than internal combustion engine cars. This year, 41% of respondents in Europe said they would consider switching to an electric car compared with 48% last year, while in the United States the number fell three percentage points to 31%, the survey showed. In terms of the pace at which the charging experience is improving, only about half of European drivers said public charging had improved in the last year, below China's 74% and 80% in the United States. Only 17% of European drivers asked said public charging offered value for money, compared with 69% in China and 71% in the United States. Shell runs 75,000 charging points and focuses its EV strategy on fast, on-the-go charging points rather than home-charging. Its core EV markets are China, Britain, Germany, Switzerland, Singapore, the Netherlands and the United States.
