Arjun, Great commentary and overview connecting the dots between transportation fuel projections, EV demand, and oil supply/demand dynamics all overlaid with ROCE metrics. Appreciated the earlier recommendation on reading Liberty Energy ESG report ... Energy/Climate/Demographics 101 wrapped up in one report. https://www.libertyenergy.com/betteringhumanlivesv2 Hope Pelz Golf worked for your short game.
“There’s almost no appetite from investors or companies to get back to reinvesting over 100 per cent of your cash flow,” says Arjun Murti, a veteran oil analyst who is now an adviser at Veriten, an energy consultancy. “We are looking at a slower pace of growth. It’s a meaningful development for oil markets.”
Great Video Arjun! As you noted Tesla is a luxury car manufacturer. If I remember correctly, one of Motorhead's points has been that luxury car sales are a limited global market which Tesla is currently dominating. But the size of the annual luxury car market is limited (I think he said somewhere between 4-5 million units), such that it will limit Tesla's future growth. I'm a Subaru fanboy, so when I saw their new EV was the size of their small SUV (the Crosstrek), but the base model was $45K and fully loaded over $60K, it seemed to me that a $7500 tax credit won't incent the average Subaru buyer to make the switch. Which may be why NYS, where I live, is making it mandatory by 2035. Also with regards to no real movement in average fuel economy, I've experienced that. Same model car got larger over time (more weight), but engine/powertrain became more fuel efficient according to EPA. But in real life my MPG has stayed roughly the same. In the short to medium term I think Toyota has it right in terms of pragmatism, you get better MPG for less cost with hybrids, which the masses can afford. You also need less metals/refining for small hybrid batteries compared to what is necessary if we all go full EV, which as you have noted is a real world constraint in the time frames Western governments are committed to. I'm not a hater of EVs, but I think about what the average person can afford and will be willing to pay in a free market. As such, I agree with you that we haven't reached peak oil demand and it will be a while before we get there. (BTW can't believe you're unfamiliar with Hyundai/Kia-these less expensive Korean brands have become popular with the working/middle classes as new car prices have increased, as you get more bang for your buck than with the equivalent Honda/Toyota model.)
We also have a Subaru Forrester. I will say one of the all-time best car purchases we have made. Love that car. It's kind of the family back-up car that we use on longer trips. I love it.
Arjun, Great commentary and overview connecting the dots between transportation fuel projections, EV demand, and oil supply/demand dynamics all overlaid with ROCE metrics. Appreciated the earlier recommendation on reading Liberty Energy ESG report ... Energy/Climate/Demographics 101 wrapped up in one report. https://www.libertyenergy.com/betteringhumanlivesv2 Hope Pelz Golf worked for your short game.
thanks so much Steve. And yes, definitely recommend Pelz Golf. life changing short game instruction.
Arjun,
Congratulation on being quoted by FT:
“There’s almost no appetite from investors or companies to get back to reinvesting over 100 per cent of your cash flow,” says Arjun Murti, a veteran oil analyst who is now an adviser at Veriten, an energy consultancy. “We are looking at a slower pace of growth. It’s a meaningful development for oil markets.”
https://www.ft.com/content/60747b3b-e6ea-47c0-938d-af515816d0f1?shareType=nongift
thank you!
Great Video Arjun! As you noted Tesla is a luxury car manufacturer. If I remember correctly, one of Motorhead's points has been that luxury car sales are a limited global market which Tesla is currently dominating. But the size of the annual luxury car market is limited (I think he said somewhere between 4-5 million units), such that it will limit Tesla's future growth. I'm a Subaru fanboy, so when I saw their new EV was the size of their small SUV (the Crosstrek), but the base model was $45K and fully loaded over $60K, it seemed to me that a $7500 tax credit won't incent the average Subaru buyer to make the switch. Which may be why NYS, where I live, is making it mandatory by 2035. Also with regards to no real movement in average fuel economy, I've experienced that. Same model car got larger over time (more weight), but engine/powertrain became more fuel efficient according to EPA. But in real life my MPG has stayed roughly the same. In the short to medium term I think Toyota has it right in terms of pragmatism, you get better MPG for less cost with hybrids, which the masses can afford. You also need less metals/refining for small hybrid batteries compared to what is necessary if we all go full EV, which as you have noted is a real world constraint in the time frames Western governments are committed to. I'm not a hater of EVs, but I think about what the average person can afford and will be willing to pay in a free market. As such, I agree with you that we haven't reached peak oil demand and it will be a while before we get there. (BTW can't believe you're unfamiliar with Hyundai/Kia-these less expensive Korean brands have become popular with the working/middle classes as new car prices have increased, as you get more bang for your buck than with the equivalent Honda/Toyota model.)
We also have a Subaru Forrester. I will say one of the all-time best car purchases we have made. Love that car. It's kind of the family back-up car that we use on longer trips. I love it.