The eyes of the markets return to focus on the Petroleum after decision by OPEC and 10 other countries non-OPEC to extend the agreement on production cuts until the end of 2018. The agreement, we recall, provides for the cut of 1,8 million barrels compared to the levels of October 2016, of which 1,2 million from the OPEC and 0,6 million from non-OPEC countries.
Also in the spotlight is the World Energy Outlook 2017 of the International Energy Agency (IEA), presented today at Eni's headquarters by director Fatih Birol, in the presence of ministers Calenda and Galletti and the managing director of Eni Descalzi. According to the report, despite the increasingly rapid rise of electric vehicles, the world is not yet ready to say goodbye to the black gold.
According to the IEA, US production of tight oil will continue to increase of 8 million barrels per day until 2025, recording the longest and most sustained production growth that a single country has ever recorded in the history of oil markets. A reality which, together with the increasingly rapid replacement of traditional cars with electric vehicles, will lead to the maintenance of low oil prices much longer.
As expected, the demand growth is expected to remain robust through the middle of the next decade, to then slow down significantly due to reduced demand for oil in passenger vehicles due to greater efficiency and the use of alternative fuels. In fact, the IEA foresees at this juncture 900 million electric vehicles by 2040.
However, the expansion of electrification will be partially offset by the contribution from other sectors (petrochemicals, heavy vehicles, air and naval transport) which will keep demand on an upward path that will lead it to reach 105 mb/d by 2040.
The market is therefore preparing to face a real challenge. A challenge that Eni CEO Claudio Descalzi does not intend to underestimate: “We are in the situation of changing a large vehicle, a whale, which must become a gazelle: it is the strategy we have thought of because we must take into account the short and very short but also the medium and long term. The first step is transformation, the one we have done and it goes towards the future which is not three years but 10-20-50 years". This was stated by the manager on the sidelines of the presentation of the World Energy Outlook 2017. “We must not cancel everything but transform it; there is room for electric vehicles, there is room for alternative fuels and for the transformation of chemistry”.
