The Electric Car's Shrinking Role in Reducing Oil Demand

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2022-09-22 04:30:10

There are over a billion cars globally and over 200 million in the US. The world can produce ~85 million vehicles per year. It would still take over a decade to replace the global car fleet with electric models assuming no growth in total car numbers. Many think that oil demand can't fall faster than this replacement rate or that only autonomous electric taxis can speed the process up. The vehicle count and oil demand relationships are more complex.

Crude oil is a mixture that varies widely based on the geological conditions it developed in. It can contain gases, liquids, waxes, and asphalt. Transportation, industry, commercial, and residential sectors are the significant crude users in the US.

Roughly 90% of the liquid products go to transportation. A small amount goes towards heating oil and industrial processes. Asphalt, wax, petroleum gases, and other products make up most industrial crude oil demand.

Transportation fuels in the US are gasoline for cars and other light vehicles, diesel for trucks (like semis), buses, or trains, jet fuel for planes, and residual fuel oil for ships. Only 2%-3% of passenger vehicles use diesel.