Is the next oil shock crisis around the corner?
In What’s Next for the Economy, I compared current events and the early 1970s, and I stated that: “All we need now is an oil shock, which I believe is just around the corner…” At the time I wrote those words, I was very confident of that prediction; however, recent literature made me question my own conclusions. In a recent article in Bloomberg by Jessica Shankleman and Haley Warren (May 31, 2017), the authors make the argument that technological changes in fuel efficiency and electric cars will drive demand for global oil demand down from about 95 billion barrels per day to 75 billion barrels per day by the year 2040. 
Another graphic in that article shows an exponential rise in electric vehicle annual sales from less than a few hundred thousand in 2017 to over 21 million by the year 2030. The article also states that there are currently 1.2 million electric vehicles in use today. But when I compare that to the 1.2 Billion vehicles in use today, and the annual sales of over 90 million vehicles worldwide which is growing at 5% per year, I come to a much different conclusion.  I can’t foresee electric vehicles overtaking fossil fuel vehicle sales in my lifetime, unless there is some significant shift in the cost or availability of oil in the near future.
I subsequently came across a blog reference from a tweet by @zerohedge that pointed to an article by Chris Martenson titled “The Looming Energy Shock: The next oil crisis will arrive in 3 years or less.” In this article, the author states that because of the drop in oil prices, investment in oil prospecting is at its lowest level in almost 10 years. In addition, oil discoveries is at its lowest level in over 15 years. Due to the significant delay between oil investment and oil production from those investments, an oil shock is nearly inevitable. 
 “This Is What the Demise of Oil Looks Like,” by Jessica Shankleman and Haley Warren, May 31, 2017, Bloomberg news, https://www.bloomberg.com/graphics/2017-oil-projections/?cmpid=socialflow-twitter-business&utm_content=business&utm_campaign=socialflow-organic&utm_source=twitter&utm_medium=social
 Total-In-Use-Vehicles and Total-Worldwide-Sales numbers for auto and commercial vehicles from the Organisation Internationale des Constructeurs d’Automobiles” (OICA) website: http://www.oica.net
 “The Looming Energy Shock: The next oil crisis will arrive in 3 years or less,” by Chris Martenson, June 30, 2017, https://www.peakprosperity.com/blog/109505/looming-energy-shock