Gasoline’s had a long run, but few agree on how much longer
Gasoline has been flowing freely from the pumps for so long that we forget how the newly born car industry took nearly 30 years to figure out which fuel would power the automotive century. Stanley built steam-powered cars until 1924, and it was the Great Depression that knocked out Doble, another steam brand, and Detroit Electric, which built a total of 13,000 of what we now call “battery-electric vehicles” before its demise in 1939. By then, crude oil and its several byproducts were already the dominant source of propulsion energy and lubricant in transportation, and as plastics developed, oil became crucial to the production of cars as well.
Oil emerges from the earth composed primarily of two of nature’s most common elements—carbon and hydrogen—married in an extremely heavy, long-chain molecule that gives crude its sticky, tarry nature. Ask a dozen experts how much oil is left or how long consumers intend to keep burning it despite its apparent environmental and geopolitical costs, and you’ll get 15 opinions. There are several points that most observers agree on, however. The global population will continue to grow at least through 2050, to perhaps nine billion and largely urbanized, predicts energy giant Shell. Those new people, especially in developing nations where energy-usage trends are steeply upward, will want more energy than is being produced now. Shell predicts that, by 2100, global energy demand will be double that of today. How much of that energy comes from oil, coal, natural gas, solar power, wind power, and other sources is a matter of confounding uncertainty, hinging on the unknown variables of technological change and government legislation, but pretty much all agree that oil will be a dominant part of the energy mix for decades to come.
“A great percentage of the world’s people are still looking forward to owning their first self-propelled thing,” says oil policy analyst David Yager of Calgary, Alberta, “and these ‘things’ are going to run on gasoline.” Yager points to an annual 20-years-out forecast produced by BP, whose analysis is echoed by Shell and others, which predicts rising energy demand worldwide but decreasing oil demand in richer developed nations that can afford to diversify into other energy sources. Even in the rich countries, any drop in demand is heavily predicated on government regulation and the willingness of drivers to buy electric vehicles in large numbers and/or abandon car ownership in favor of ride-sharing fleets.
That’s where the outlook really varies depending on whom you talk to. One recent study out of Stanford University daringly predicts that, by 2030, fully 95 percent of vehicle miles traveled in the U.S. will be in autonomous vehicles owned by fleets such as Uber and Lyft. That’s because the competition among ride-sharing fleets plus the rapid pace of innovation will drive down costs such that the average American driver will think it ridiculous to own a personal car. Some people call this the “collapse” scenario, the old system of private cars and gas stations vanishing astoundingly quickly in much the same way that we rocketed from pocket pagers to smartphones in a few short years. But, hey, this study is out of Stanford, the heart of Silicon Valley, where the stock price quivers if you haven’t disrupted a market by lunchtime.
A less ambitious read comes from another study by researchers at the University of California-Davis and the Institute for Transportation and Development Policy, which posits several scenarios happening by 2050. The most likely one, they believe, is that transportation will morph into a mix of ride sharing and new forms of public transport that drastically cuts energy consumption and out-of-pocket costs for transportation—mainly in urban settings.
Where does that leave car owners? In the near term, says Yager, gas prices will rise because world demand is swelling along with a healthy global economy, but investment in oil-production infrastructure has stagnated during the long period of low prices. Meanwhile, the easy oil has been largely used up, adds Jeremy Martin, senior scientist and fuels lead for the Union of Concerned Scientists, meaning the cost and pollution generated in producing new supplies, such as through fracking or deep-water drilling, are increasing. Biofuels could be one answer, and a car-industry push for higher octane standards could go hand in hand with an increase in ethanol content, perhaps from the current E15 standard to E25—if Congress can ever agree on anything.
All of this could raise pump prices enough to give a new generation of electrics the fertile soil they need to start making big sales numbers. Although it’s still a minority that believes in the collapse scenario, “the doom is more plausible than it was five years ago,” Martin says. Even so, he adds, “we’ll have liquid fuels for a long time to come.”