Shell Says Global Oil Demand Will Peak by 2020

The rise of electric cars has led many analysts to make predictions about the future of the oil industry.

ExxonMobil and OPEC have both made statements indicating confidence that the majority of vehicles on the world's roads will continue to be powered by fossil fuels for the next few decades. But Royal Dutch Shell recently made a prediction that is a bit less confident, CS Monitor reported.

The world's second-largest energy company by market value, Shell believes oil demand could peak by 2020.

"We've long been of the opinion that demand will peak before supply," Shell CFO Simon Henry said in a conference call last week.

That peak could occur "somewhere between five and 15 years hence," Henry said, and will be driven by "efficiency and substitution."

Shell's vision puts it at odds with ExxonMobil which, in its annual outlook, said it expects oil demand to increase 20% between 2014 and 2040.

The company previously said that electric cars would account for less than 10% of global new-car sales in 2040.

The organization of Petroleum Exporting Countries has also said that 6% of cars on the world's roads in 2040 would be powered by anything other than gasoline or diesel.

Among its members, Saudi Arabia believes its oil reserves will last 70 years, and that demand will grow. Even if oil demand peaks fairly soon, as Shell predicts, it may not decline into oblivion immediately.

Shell also expects to remain in business by shifting to production of natural gas, as well as bio fuels and hydrogen.