Let’s be clear: Oil and gas demand took a very substantial hit from the worldwide ban on travel, and the shift from office work, to working from home. However, it is expected to recover to near pre-pandemic levels soon and there is every reason to believe it will go up after that for many years to come.
Most of this positioning is based on recent reports by organizations like British Petroleum and the International Energy Agency. While these reports see demand and consumption greatly decreasing, if, and that is a very big if, countries follow very expensive sustainable development scenarios which they have not followed up until now.
Stated policy scenarios for meeting energy demand from these sources show that demand might only decrease a little, but oil and gas will still make up a significant portion of the energy mix.
The most recent report on the demand and consumption outlook comes from the Organization of Petroleum Producing Countries, a consortium of oil-producing states primarily in the Middle East. While talking heads took the report to show that oil demand is decreasing, the report shows demand is substantially increasing in developing countries.
The OPEC report notes that while there will be a slight demand decrease from 47 million to 35 million barrels per day in developed countries by 2045, demand will be increasing in non-OECD countries as they improve their economies and quality of life. Energy use and fossil fuel consumption is directly linked to an increase in these major indicators. And don’t forget that this is where the vast majority of the world’s 7 billion people live.
Quite frankly, it is not hard to see how fossil fuels will be a major part of the energy mix in the next 30 years. The population of Earth is expected to increase to almost 10 billion people by 2050. Like the OPEC report alluded to, most of this increase will be in developing countries in Asia-Pacific and Africa. Unless you don’t believe these people will want vehicles, air conditioning, heating, and all the amenities of modern life, they will consume more energy per person than they do today. With the increasing population and increasing affluence, governments in these developing regions will need a reliable supply of energy to keep their citizens out of the dark, and their economies growing.
So, the future involves more governments finding responsible ways for their populations to consume more fossil fuels. Responsible countries are going to need to consider which energy producers take the challenge of reducing emissions and providing reliable energy with the least environmental impacts seriously.
According to a report published earlier this year by the Bank of Montreal, Canada ranks #1 of major oil producers in Environmental, Social, and Governance standards. Last year, Navius Research found that Canada had a comparative advantage in carbon emissions when it comes to emissions-intensive trade-exposed industries. Canada’s oil and gas industry also spends heavily on clean technology and the environment. From 2015 to 2017, the oil and gas industry spent $2.75 billion on clean technology alone. we can lower emissions globally and be the world’s energy provider.
Energy makes the modern world and almost the entire planet aspires to enjoy the modern world. More energy will be consumed in the future and fossil fuels will provide that energy. To meet this global energy challenge the world will require countries like Canada to take the lead.
Comparatively, Canada can help lower emissions globally and be the world’s energy provider.