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The end of the ICE age as we know it? Not by a long shot

Electric vehicle sales are rising and a few notable governments are looking to ban internal combustion engines (ICE) — many people point to these two ‘truths’ as hard evidence of the sun setting on the oil industry.

Not so fast says Peter Tertzakian, noted energy analyst and commentator.

“In 2016, over 69 million new passenger vehicles of all types rolled off of global automakers’ assembly lines,” writes Tertzakian in the third part of his ongoing series exploring electric vehicles and oil demand. “On average, that number has been growing by a robust 5 per cent every year since 2010.”

According to the International Energy Agency, a Paris, France-based Think Tank, 2016 saw a record number of electric car sales at 750,000 world-wide — representing barely one percent of all vehicles produced around the globe that year.

It’s no wonder then that the same IEA is forecasting strong growth for global oil demand, forecasting 2017 to be on track for an additional 1.6 million barrels per day, pushing global average consumption to almost 100 million barrels per day — or what Tertzakian describes as “the equivalent of burning an ultra-large supertanker of oil every half hour.”

Some advocates argue limiting carbon dioxide emissions and addressing climate change necessitates government policy changes ‘banning’ ICE cars altogether. And the policy position appears to be gaining traction in some nations as Norway, the UK, France, India and China have all signaled their intention to ban ICE cars sometime in the next 20-30 years.

But does this mean that ICE vehicles will no longer be driven, full stop, at some defined point in the very near future?

Tertzakian says no: “…imagine that we wake up in 2040 and learn that every country kept to their promise. In 23 years all new vehicle sales — everywhere — would be electrically-powered.

“Even under such heavy-handed government restriction, the global fleet of purely petroleum-powered cars wouldn’t start to decline until 2030 at the earliest. By 2050, it’s quite likely that there would still be the same number of ICE vehicles on the road as today.”

Tertzakian’s series is a fascinating look into the realities of technology adoption in the transportation sector and its effect on future oil demand. You can read his full analyses on Financial Post:

Part 1: If the ‘end of oil’ is upon us, why’s demand for crude rising at near-record pace?

Part 2: If electric vehicles are so great, why does the world need to ban the internal combustion engine?

Part 3: Old pistons die hard: Why mass de-carbonization won't mean the end of the road for gas powered cars

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