OPEC will attempt to manage perceptions in both the physical and financial markets—but given its track record, it will not likely produce stability and certainty, but instead ambiguity and volatility.
The direction of hedge funds bets in the coming weeks and months will depend on a number of factors, including the U.S. rig count, the strength of the dollar, the Fed’s decision on whether to raise interest rates, and of course OPEC.
Two major forecasters see a sharp penetration of EVs in the next couple of decades. Although the outlook for EVs and the transportation sector is improving quickly, oil demand is likely to continue to grow.
Stay on top of the latest developments in oil markets, geopolitical risk, and alternative fuel vehicles with the SAFE policy team's Chart of the Week.
When producers that are inherently prone to conflict and resource nationalism lose supply, output will most likely not return to previous levels.
"The more miles that autonomous vehicles travel—on different roads, in different environments, and under various weather conditions—the more quickly their safety improves."
The risks of more oil production losses have intensified as the financial screws on Caracas continue to tighten. Deteriorating conditions in Venezuela are occurring at the same time OPEC is looking to extend its production cut and tensions throughout the Middle East are rising.
Digital technologies may lower oil and gas production costs by 10 to 20 percent. As a result, technically recoverable oil and gas reserves could climb by as much as 5 percent globally, with the largest gains from shale gas.
Even with an entirely different landscape due to EVs becoming a greater part of the fleet, there is essentially no way to avoid the fact that ICE vehicles will be around for a very long time.
Given the costs of oil dependence, maintaining and reforming the EV tax credit is of strategic importance to the U.S. The tax credit has been vital in helping EVs gain traction in today’s competitive car market.