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article imageOp-Ed: OPEC's issues being worsened by technology and electric vehicles

By Karen Graham     Jul 31, 2017 in Technology
The turmoil being seen in the oil and gas industry, along with the surge in technologies behind the electric vehicle, wind and solar industries are about to butt heads in a showdown that will eventually lead to the demise of OPEC.
OPEC ministers must surely be worried as their attempts at reigning in oil production to raise oil prices globally appears to be dead in the water. Gone are the good old days when oil prices were sky-high at up to $100 per barrel and OPEC oil was in huge demand.
Since that time, OPEC has seen its grasp on the global energy market slowly decline. Now the cartel is faced with prices stalled at about $50 per barrel and U.S. Shale production is flooding the market.
A number of international petroleum companies began tightening their belts last year, preparing for the long-term, selling off assets and downsizing their employee base to ensure sustainability. And while these companies are learning to live with lower oil prices, the oil cartel countries aren't.
US shale oil producers are ramping up output  denting OPEC's efforts to fight a global supply g...
US shale oil producers are ramping up output, denting OPEC's efforts to fight a global supply glut
DAVID MCNEW, GETTY IMAGES NORTH AMERICA/AFP
Ecuador recently had to pull out of the OPEC production deal, citing economic problems. But with a recently elected new government, the country is now looking at a complete split with  Opec's production curbs, saying it needs to pump more oil to address its fiscal deficit.
Clean energy and electric vehicles will be the death of OPEC
As I wrote in February this year, research, innovation and emerging technology, such as using printable solar photovoltaics in the production of electric cars will see EVs making up as much as a third of the world's road transportation by 2035.
All EVs have three basic components  the batteries  the controller and the electric motor.
All EVs have three basic components, the batteries, the controller and the electric motor.
Car News Cafe
The coal and oil industries are seriously underestimating the impact the renewable energy industry is making on the world. Technological advances have resulted in innovative manufacturing and less costly production methods, making end products in the electric vehicle and solar and wind energy sector more affordable.
Particularly exciting are the huge advances being made in research and development on batteries for electric vehicles. In a move aimed at powering the transition to a low-carbon economy, the U.K. announced last week it was investing in battery technology research and development to the tune of £246 million ($320 million) over the next four years.
The international community is taking climate change and the transition to a low-carbon economy very seriously, and this concern has already led to four countries putting bans on the sale and use of gasoline and diesel-powered vehicles within the next two decades.
Besides India, France, Britain and Norway announcing bans, Austria, China, Denmark, Germany, Ireland, Japan, the Netherlands, Portugal, Korea and Spain have set official targets for electric car sales. The United States doesn't have a federal policy, but at least eight states have set out goals to proceed with bans on EVs, according to CNN Money.
Electric car batteries may soon become more affordable to consumers
Electric car batteries may soon become more affordable to consumers
Frank Hebbert via Flickr
The OPEC ministers may be living in the past, but the present is here. Battery technology has done more to fuel the growth of electric-powered cars than oil could ever begin doing, and the need to mitigate climate change is gaining increasing support. And keep in mind that electric vehicles are not the only form of transportation being impacted by innovations in battery technology. Don't forget airplanes and railroads.
Indian Railways is the largest rail network in Asia and a huge consumer of diesel fuel. The rail company runs 11,000 trains daily, moving about 13 million passengers every day. In 2015, Indian Railways spent Rs16,395 crore ($2.5 billion) on diesel fuel. Last week, the rail company inaugurated its first train with six coaches powered by solar produced electricity.
Wright Electric s goal is for every short flight to be electric within 10 years.
Wright Electric's goal is for every short flight to be electric within 10 years.
Wright Electric Inc.
The company says it plans to install solar panels on 24 more trains within the next six months. The company estimates that just one train with six solar powered cars can save 21,000 liters (5,547 gallons) of diesel fuel per year, at cost savings of around Rs12 lakh (almost $20,000).
I'm going to make a prediction, as an armchair analyst, and say that within the next few years, OPEC will lose its control over global oil production. I am basing this on not only increased shale production in the U.S. But more so because of the acceptance of renewable energy sources worldwide.
We have already seen a decline in coal production globally. Will we see a time when oil is no longer being used? Don't bet on that. Renewable energy will end up playing a very big role in future energy markets, and smart investors are already putting their money into this growing sector.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com
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