Will BP be the Nokia of Oil&Gas and Shell develop the iPhone of renewables?

big oil


  • Fundamentally different believes of the future of EV by the leading O&G players
  • BP sees EV with limited impact on oil business and continues the status quo. Report generated by BP provides following findings:
    • Electric vehicles (EV) reduce the number of internal combustion engine (ICE) cars. An extra 100m battery-electric vehicles could lower oil demand by around 1.4 Mb/d in 2035
    • Autonomous vehicles (AV) increase efficiency and so reduce energy demand. If AVs are 25% more fuel efficient, 100m autonomous ICE cars could lower oil demand by 0.4 Mb/d in 2035 (autonomous EVs reduce demand for electricity but not oil)
    • Car sharing on its own doesn’t affect energy demand; it simply increases the intensity with which vehicles are used. But if combined with a new technology, such as an EV or AV, it can act to amplify the effect of this technology since more miles are travelled using this technology and less using conventional cars
    • Ride pooling reduces the number of vehicle miles driven by raising the number of occupants per vehicle. A 10% fall in vehicle miles lowers oil demand by around 2.5 Mb/d in 2035
  • Shell leaderships drives EV, aligns strategy direction to account for significant change in O&G business. Shell is pivoting to focus on hydrogen fuels and biofuels for airlines and heavy freight vehicles

So what:

  • O&G profits are still enormous and generated by selling oil and gas products, there will be no significant change of strategy until the O&G players see bottom line impacts
  • There is a huge debate about how and when the impact of EV will come to O&G demand. However, the figures provided by BP seem very conservative and contradict most estimates of EV adoption. Shell acknowledges the reality that oil demand will reach its peak rather sooner than later and, at least, markets itself as embracing the change to EV. Significant investments in renewables are, however, still missing

Stories to shine:

  • “The Shell CEO drives an electric car”
  • “Ben Van Beurden is swapping big oil for big batteries”

Link to articles: 


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