In recent days, U.S. President Donald Trump has increased his pressure on the OPEC members to decrease the oil price and it indicates that the world response to Trump’s demand has led to a hike in oil price.
On the other hand, the famous oil news wire “Oil Price” in a report, by referring to the recent report of the Center for Studies of Bank of America, has claimed that the world economy would witness serious changes for replacing energies since 2030.
The Oil Price report reiterates that oil demand should continue to grow by 2030 although at a slower and slower rate. According to Bank of America, the annual increase in global oil consumption slows dramatically in the years ahead, especially between years 2020 to 2030. According to statistics, b 2024, demand growth halves, falling to just 0.6m barrels per day, down from 1.2 mb/d this year.
With referring to this analysis, one can definitely say that in the next ten years, the demand for crude oil would not just decrease but also it would be unsanctionable due to the huge demand in the market and the spot oil market will always fix the price. But the main driver of the destruction in demand in the 2030’s is the proliferation of electric equipment especially vehicles. Boom in using train and electronic vehicles will lead to the fall in demand for oil and its products. Bank of America in its report did offer a few caveats and uncertainties which can have their impacts on the oil market. The report points to the current economic condition and probable disrupt in the free trade process in the world due to President Trump’s policies in the recent years as the worrying factors for instability of the oil market. Impacts of both factors would be significant in the decade ahead.
Since the day Trump’s Administration took office, it has been the source of most instabilities in the world economy and it has led to losing its credibility for dictating its policies. It seems the impacts of Trump’s policies will not last more than one or two years and it could be completely controlled and thwarted.
By: Hamid Reza Naghashian
