Future Of Oil In Global Economy

Abstract

In the economically growing world, oil has become the heart of all commercial activities and development. But
the oil sector is facing an uncertain future. Firstly, it is a non-renewable energysource, and secondly, it is a
significant contributor to carbon emissions. There is an increase in the consumption of alternative energy
sources as substitutes for crude oil to overcome these issues. This paper aims to forecast the demand for oil in
the coming years and analyze whether renewable energy sources can fulfill the oil demand. Three forecasting
models — the Trend analysis model, the Growth rate model, and the ARIMA model — are employed to
estimate the production and consumption of oil and renewable energy sources in 2050. The study’s findings
suggest that the increasing renewable energy production is not enough to fulfill the enormous increase in oil
demand. It is also evaluated that renewable energy is possibly a good substitute for oil but not a perfect one.
And hence, oil is likely to remain a significant source of energy even in the future.