Oil demand may never recover from the blow dealt to it by Covid-19, according to BP’s 2020 Energy Outlook.
In two of the report’s three modelled scenarios, ambitious climate policies mean that global oil consumption already peaked at 100m barrels per day in 2019. Even under a “business-as-usual” case, demand for the fossil fuel would briefly rebound before hitting a terminal plateau in the early 2020s. By BP’s own admission, it’s not a lucrative moment to be an oil company. But it’s a promising time to make acquisitions in the wind industry.
Last September, the oil major purchased a $1.1bn stake in two offshore wind projects being developed off the east coast of the US by Norway’s Equinor. In the aftermath of the pandemic, few industries looked like safe investment prospects – with the notable exception of offshore wind. According to a market outlook published by the Global Wind Energy Council (GWEC) last November, a total of 71.3GW of wind power was expected to be installed in 2020. This is just a 6% decrease from pre-Covid forecasts.
Royal Dutch Shell has plummeted to a mammoth 21.7 billion US dollar (£16 billion) full-year loss after hefty write downs as oil prices crashed amid the pandemic.
The oil giant’s plunge into the red compares with profits of 15.8 billion US dollars (£11.6 billion) in 2019 and comes after it was forced to slash the value of the oil in its fields last year as prices collapsed.
The cost of crude has since started to recover, but not enough to prevent Shell slumping to a 4 billion US dollar (£2.9 billion) loss in the final three months of the year.
Shell said that, on an adjusted basis, it made earnings of 393 million US dollars (£289 million) in the fourth quarter, though this was worse than expected and 87% lower than a year earlier.