The global energy market is under constant evolution and right now we are in the midst of a major revolution. It’s the evolution of the natural gas as a major power source that will replace oil. We have mentioned this before and will once again -  Oil’s share in global energy consumption is in decline and we had peak oil in the 80’s like we had peak coal in the 30’s and peak wood before that.

But what that means - Are we going to experience prolonged lower oil price? Will the consumption of oil decline within next decades?

The answer is simply ‘No’. We have addressed the issue of the lower price in a previous article hence we would focus on the second part - Will the consumption of oil decline within next decades?

And the history of energy sources tells us that the answer is a definite ‘No’.

We would look at different 50-year era in energy consumption by source:

• In 1899, global coal consumption was around 500 metric ton and the usage of oil was negligible. But as oil production increased along with discoveries, oil started competing with coal. The usage accelerated during the World War I and II. By the end of first 50 years, global coal consumption was just below 1000 metric tons, while oil consumption went from near zero to 500 metric tons.
• By the end of 60’s oil consumption had taken over coal. However, it is important to note that the coal consumption was still growing but at a lower pace. By the next 50-year era, global consumption of oil reached while above 3500 metric tons, while coal consumption grew to 2300 metric tons.
• What happened next is very interesting and very important to take note of. The advance of oil led to the drop in coal prices (can u find some similarity) that coincided with the industrialization of China and resulted in a different sort of dynamics in the market. Coal’s disadvantage to oil finally became its advantage finally.
• From 2000 to till the global financial crisis, the consumption of coal rose much faster than the consumption of oil, especially as oil price rose. In this period coal’s consumption rose from just 2300 metric tons to 3500 metric tons and in the same period oil’s consumption rose from 3600 to 4000 metric tons.

A new player entered the market in the meantime and that’s gas. U.S. shale boom led to a lower natural gas price that led to an increased consumption. Gas now contributes 29 percent to U.S. energy consumption and we expect the next few decades would be LNG’s But history teaches us that it is not the end of the oil.