Donald Trump (the United States President) seems to have a special interest in polluters, quacks, coal companies, and flatterers. It is not surprising then that when the prices of oil dropped in mid-April, the president posted a tweet regarding this.
We will never let the great U.S. Oil & Gas Industry down. I have instructed the Secretary of Energy to formulate a plan which will make funds available so that these very important companies and jobs will be secured long into the future.Donald Trump (U.S President)
During this period, some people started having doubts about the future of fossil fuels. Brent crude price had dropped to US$20 per barrel. Oil-futures prices dipped into negative levels in areas like Texas, where there was no more room for producers to store inventory; this means some producers had to shell out US$40 per barrel to avoid this.
The New York Times released a story titled “Oil Companies Are Collapsing, but Wind and Solar Energy Keep Growing,” which revealed that this year, sources of renewable energy would deliver 20.7% of electricity in the United States (which would be a record with an increase from 18% a year earlier).
“While work on some solar and wind projects has been delayed by the [virus] outbreak, industry executives and analysts expect the renewable business to continue growing in 2020 and next year even as oil, gas and coal companies struggle financially or seek bankruptcy protection.”
Although, the prices of oil have bounced back somehow after seeing record lows, recently, the International Energy Agency revealed that in 2020, there will be the lowest demand for oil for the past 25 years.
Even assuming that travel restrictions are eased in the second half of the year, we expect that global oil demand in 2020 will fall by 9.3 million barrels a day versus 2019, erasing almost a decade of growth.
Of recent, Telegraph observed that “there is mounting evidence that a second wave of COVID-19 could send prices spinning into a nosedive once more.”
AxiCorp’s Chief Global Markets Strategist, Stephen Innes, revealed this week that
Most oil market participants expect more downward pressure on oil … with COVID-19 ravaging the landscape and OPEC+ adding more barrels into play.Stephen Innes
Meanwhile, a report from the Times revealed that the solar capacity of the United States increased in 2019 by 23%. ConnectGen’s CEO, Caton Fenz said that “we blew through all of the projections; we’re surfing a long-term wave.”
During the Building Back Better roundtable on energy innovation by Corporate Knights in May, Seamus O’Regan (the Federal Natural Resources Minister) made a declaration that accepting green energy is an advance and not a retreat.
Net-zero is not just a plan for our environment. It is a plan for our economic competitiveness. And increasingly, this is where markets are going. Ultimately, you follow the money. And the money is increasingly steering us toward net-zero solutions.Seamus O’Regan