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Battling for a Shrinking Market: Oil Producers, the Renewables Revolution, and the Risk of Stranded Assets

  • Thijs Van de Graaf
Chapter
Part of the Lecture Notes in Energy book series (LNEN, volume 61)

Abstract

Oil and gas producers such as the OPEC countries and Russia are easily portrayed as the ‘losers’ of a transition to renewables. This chapter investigates their role in the new energy game and explores the strategies they could employ in a carbon-constrained world. After recounting how and why petroleum became the most important energy source in the global economy, this chapter discusses the likelihood of peak oil demand. It then looks at how private international oil companies and oil exporting countries would be affected by a global transition to renewable energy, and considers possible strategies that oil producers might follow in the face of dwindling demand and abundant reserves. The chapter concludes by arguing that the common wisdom about the geopolitics of oil needs to be revisited, as it will revolve around abundance rather than scarcity. Oil abundance creates winners (most notably the United States and import-dependent countries) but also losers (especially petrostates that are heavily dependent on oil revenues and have few competitive industries beyond fossil fuels).

Keywords

Petroleum Peak oil demand OPEC and Russia Geopolitics Resource extraction 

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© Springer International Publishing AG 2018

Authors and Affiliations

  1. 1.Department of Political SciencesGhent UniversityGhentBelgium

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