The second part, at least, may finally be coming to an end.
By 2027, electric vehicles will force a reversal to the era of rising demand for oil used in transportation, according to a new forecast by analysts at BloombergNEF.
For areas outside of transportation - such as plastics, petrochemicals, manufacturing and agriculture - oil demand will continue to rise with no end in sight.
But by 2029, BNEF expects the stark shift to EVs to outweigh all else and bring total demand to its apex.
Oil analysts have spent years grappling with the impact from the transitioning to electric vehicles, and have often been proven wrong.
Small differences in assumptions about EV adoption can shift predictions by years.
But a growing consensus is emerging that peak oil for transportation is within sight.
Road transportation has been the biggest driver of oil demand ever since Henry Ford made cars cheap and affordable to the masses.
Today, the open road is responsible for nearly half of the world’s oil consumption.
And as the auto fleet electrifies, its share of the overall oil market will diminish to roughly a third of the market in 2040 and a quarter in 2050.
Electric vehicles on the road right now are already displacing demand for more than 1.5 million barrels of oil a day.
Battery-powered options are becoming competitive with internal combustion in more categories, and each new segment narrows the market for future oil sales.
Global sales of cars powered by oil peaked six years ago, and the handoff to batteries is accelerating.
Last year saw EV sales increase 62% worldwide - nearly doubling in China, Australia and Japan, and more than tripling in India and South-East Asia.
Price parity between battery and combustion came first for new buses and two and three-wheelers, which are now roughly 21% and 27% battery-operated worldwide, respectively.
Now price parity is starting to be achieved for the most consequential segment of all: passenger cars and trucks.
By the end of the decade, electrified passenger vehicles will help quadruple the amount of oil avoided by EVs to roughly 6 million barrels a day, according to BloombergNEF. The forecasters see no recovery from that.
The shift from growth to shrinkage for oil demand will be geographically uneven.
Demand for oil used in road transport has already peaked in the US and Europe, according to BloombergNEF, and it will top out in China next year.
The market for internal combustion engines continues to grow in India, Australia and South Korea for years to come.
In another decade, however, the oil phase-out will leave no major region of the world unaffected.
BloombergNEF analysts caution that the 2023 outlook, whose scenarios presume today’s energy policies will continue, could be underestimating how quickly demand will shift.
Roughly 68% of world’s emissions now fall under government-backed "net-zero” targets to offset all emissions by 2050, which isn’t possible under current regulations.
"New policies are likely to expedite ‘peak oil demand’ and push the outlook for consumption lower,” the analysts wrote.
"As the biggest consumer of oil, and one with several options to decarbonise, the future for road fuel demand is likely to decline even further than our Economic Transition Scenario suggests.”
