Riding the Energy Transition: Oil Beyond 2040

43 Pages Posted: 2 Jun 2017

See all articles by Reda Cherif

Reda Cherif

International Monetary Fund (IMF)

Fuad Hasanov

International Monetary Fund

Aditya Pande

Georgetown University

Date Written: May 2017


Recent technological developments and past technology transitions suggest that the worldcould be on the verge of a profound shift in transportation technology. The return of the electriccar and its adoption, like that of the motor vehicle in place of horses in early 20th century,could cut oil consumption substantially in the coming decades. Our analysis suggests that oilas the main fuel for transportation could have a much shorter life span left than commonlyassumed. In the fast adoption scenario, oil prices could converge to the level of coal prices,about $15 per barrel in 2015 prices by the early 2040s. In this possible future, oil could becomethe new coal.

Keywords: oil price, energy transition, electric vehicle, renewable energy, Global Commodity Crises, General, Technological Change: Choices and Consequences

JEL Classification: Q02, Q40, O33

Suggested Citation

Cherif, Reda and Hasanov, Fuad and Pande, Aditya, Riding the Energy Transition: Oil Beyond 2040 (May 2017). IMF Working Paper No. 17/120, Available at SSRN: https://ssrn.com/abstract=2978681

Reda Cherif (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Fuad Hasanov

International Monetary Fund ( email )

Washington, DC 20431
United States

Aditya Pande

Georgetown University ( email )

Washington, DC 20057
United States

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