Oil product demand Ladislas Paszkiewicz
SVP Strategy & Climate
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Oil demand dominated by transport and petrochemicalsEmerging markets underpinning rising demand
26%
18%
5%6%1%
11%
6%
8%
7%
12%
2015 world oil demand by use
Petrochemicals
Industry
Light dutyvehicle
Heavy dutyvehicle
AviationMarine
Other uses, includingrefinery consumption
Transport
Othertransport
Buildings
92.5 Mb/d
1
Power gen.
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Oil demand since 2000Growth dominated by transportation
Rapid non-OECD economic development
Clear elasticity of oil demand to price: acceleration since 2014 after oil price drop
Growth concentrated in transportation, but
also petrochemical feedstock and industry
90
2000 2007 2014 2017
World oil demand by sectorMb/d
2
+0.8%per year+1.6%
per year
+1.7%per year
Buildings
Petrochemicals
Transportation
Industry, agriculture & non-energy
Power gen
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25
50
2015 2040
More driving boosts passenger transport fuel demandEfficiency improvements mitigate increased driving
Demand for passenger transport:
High growth in emerging countries
• 2000-15 average: +3.6%/y km driven
• Assumption: km driven to grow 3.5%/y
• 2 & 3 wheelers continue rapid growth
Regulation drives faster efficiency gains
• New car fuel efficiency +3%/y
• By 2040, new car consumption: 3-4 l/100 km
EV penetration by 2040
• Case considers aggressive penetration:
50% of sales, 32% of fleet
• EVs drive fewer km/y (mainly urban users)
Passenger transportation* fuel demandMb/d
More vehicle
kilometres
Biofuels & nat. gas
EVs
Efficiency gains
+2 Mb/d2015-40
3
* Light Duty Vehicles (LDV) + 2&3 Wheelers + Buses
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25
2015 2040
Growing road freight oil demandContinuous increase in freight transport
Growth dominated by long-haul freight
• 2000-15 average: +3.4%/y tonne-km
• Assumption: tonne-km to grow at same pace
Faster efficiency gains expected
• New truck fuel efficiency +1.5%/y
• Big-Data tools help boost load factor
Growing natural gas penetration
EV technology less suitable for heavy loads and long distances
Road freight transportation fuel demandMb/d
More tonne-
kilometres
Efficiency gains
EVsBiofuels, H2 & nat. gas
4
Load factor
+6 Mb/d2015-40
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10
2015 2040
10
2015 2040
Global cap stimulating LNG substitution
Low fleet turnover slowing efficiency gains
Little alternative to jet fuel
Strong traffic growth for cargo and people
Increasing demand for aviation and marine fuels
Aviation fuel demandMb/d
Oil demand for marine fuelsMb/d
More tonne-
kilometres
Efficiency gains
More tonne-
kilometres
Efficiency gains
LNG
Biojet
5
Load factor
+1 Mb/d2015-40
Load factor
+4 Mb/d2015-40
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20
2015 2040
Sustained demand for polymers
Oil demand for petrochemicals Mb/d
+0.6 Mb/d oil, +2.3 Mb/d ethane and LPG in 2040
Growing oil demand for petrochemicals
Market growth & new uses
CTO/MTO
Naphtha
LPG
Ethane
GasoilRecycling
& bioplastics
6
+3 Mb/d2015-40
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10
2015 2040
10
2015 2040
Declining use of oil for residential heating Oil use persists in some regions and for back up and peak power
Declining oil use in buildings and power generationOil displaced by natural gas
Oil demand for power generationMb/d
Oil demand for buildingsMb/d
Moregeneration*
Other sources of electricity
Growth* Other energies
Efficiency gains
Nat. gas
Nat. gas
7
-2 Mb/d2015-40
* Growth applied to oil * Growth applied to oil
-3 Mb/d2015-40
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Industry, agriculture, and non-energy usesLittle alternative to oil in some sectors (e.g. feedstocks)
15
2015 2040
Oil demand for industry and other uses Mb/d
Industrial production
growth*
Nat. gas
Efficiency gains
Other energies
8
-1 Mb/d2015-40
* Growth applied to oil
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Regional weights in oil demand are shifting rapidly
Estimated oil demand by region
100%
2015 2040
Developing markets are driving growth
OECD falls from half to about 30% of oil demand
9
Europe
Asia OECD
Asianon-
OECD
MiddleEast
Africa
Lat.Am
NorthAmerica
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70
100
130
160
190
2015 2040
Sustained oil demandDespite EVs, efficiency gains, and substitution
Demand for mobility remains strong in
emerging countries
Natural gas is the main alternative to oil
• 15 Mb/d of oil displaced by gas
Aggressive case for EV penetration
Stronger disruptions needed to meet the IEA 450 ppm scenario
Total oil demandMb/d
Growth
Efficiencygains
EvsNat. gas
BioOthers
10
+10 Mb/d2015-40
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Oil demand sensitivities in 2040
Passenger vehicules
Freight
Marine
Aviation
+/- 33%
70% of sales in 2040
30% of sales in 2040
2040 Oil Demand (Mb/d)
11
EV penetration
Efficiency gains
in transportation
4
3
1
2
6
2
-3
-3
-1
-1
-5
-3
-7 7
+/- 0.5% per year
growth