While the U.S. pats itself on the back for the riches flowing from fracking wells, an upheaval in clean energy is quietly loosening the oil industry’s grip on the automotive industry.
Presentations by analysts at Bloomberg New Energy Finance (BNEF) last week picked away at the idea that supply alone is behind the plunge in crude prices to $50 a barrel. The presentation also shows that low-pollution cars are gaining ground, weakening the link between oil and driving.
The result: Future transport is likely to look a lot different than what the major oil companies are fueling now. Instead of biofuels such as ethanol and green diesel making the internal-combustion engine fit into a world with greenhouse gas limits, wholesale new solutions are coming fast. “Where we are is in an age of plenty,” said Michael Liebreich, BNEF’s founder. “We have cheap oil, cheap gas, cheap renewables. You do have an abundance of supply in a way you haven’t had for decades. We also are in an age of competition.”