Why Predict Increase In Oil Demand?

For many people in the west, it is puzzling that oil companies are predicting massive growth in oil consumption for many years to come. To many in these countries, it looks like people are consuming less fossil fuels. Coal power stations have closed, coal home heating is a thing of the past, cars are electric or have much smaller more efficient engines, homes are better insulated, even light bulbs use 10% of the power they used to and most trains are electrified. Wind turbines, heat pumps and solar panels are springing up everywhere on land and sea. So why are the oil giants so confident of continued growth?

Why Are The Oil Giants So Confident Of Continued Growth?

Fast Developing Nations Are Consuming More Oil

Oil and gas consumption growth in many developed nations has roughly plateaued. In developing nations, it is a completely different picture. Growth is very strong and this trend will only continue as these nations accelerate their ever more successful economies. As they grow, more of their previously financially restricted people can for example afford to buy their first car. The people who could afford cars in the past can then afford more than one and bigger cars. They want more consumer goods and kitchen appliances that require manufacture, shipping and power to operate. They want bigger houses and more bigger, better stuff. They travel more and do more leisure activities. As their industries develop and get bigger and need new premises, everybody needs better infrastructure to work and play. All this construction, activity and additional purchases cumulatively use more oil and gas. Sure, they'll have as many solar panels as everyone else on the tops of their new buildings and they will buy as many electric cars and so on. But, it all still needs oil and gas. Lots.

It's Our Turn

It would be very hypocritical for anyone in Europe or North America to ask these upcoming nations to lower their demand for oil. To lower their aspirational dream lifestyle expectations. The same lifestyles that Western nations have enjoyed for decades and still enjoy today, albeit with a growing sense of just a smidge of guilt. How can anyone say, "Although you're in touching distance of that much desired lifestyle, we'd rather you didn't." How can they say, "We had a great time, but now we have all got to stop doing all this and that, and having all this stuff." "We did way too much of this sort of thing, so now the party is over for everybody." "We spoiled it for everyone, so you can't have it... Sorry!"

Fix Your Own Back Yard First

Similarly, a few hundred years ago, several European nations cut down nearly all their trees to build ships that helped grow their wealth. Now they say to countries like Brazil, "No you shouldn't do that, it's harmful for our environment". Many of them still have not even taken the steps to replace a decent proportion of the forests they destroyed in their own countries, but that doesn't stop them moaning at Brazil.

European Nations Cut Down Nearly All Their Trees

They Deserve To Have Fun Too

The people in these exciting and rapidly developing economies wouldn't listen to anyone anyway. And, why should they. They are having way too much fun climbing the ladder to success-ville. Quite right too. Their future looks bright and they deserve all the success that other nations have enjoyed. Developed nations are just going to have to put up with it, until we are all on the same playing field.

About The Author
Pablo Manente
Chewells Contributor

Pablo writes about Africa, oil, politics, human rights and many other subjects. He is a full time... »

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Replies

• Jane Duncan (Feb 20, 2024)
  The Indian economy is vibrant and about to explode. They will become the economic power of the future. Oil demand will follow their progress more than any other nation.

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