The U.S. may produce triple the amount of crude oil, but China is leading the global energy race because of its dominance in building up supply chains for renewable energy and electric vehicles, the chief U.S. economist for BP said.
Even as crude oil, natural gas, and coal still lead global energy, clean energy and EVs continue to rise—despite near-term economic headwinds—and that upward trajectory is unlikely to change regardless of politics and tax credits, said Michael Cohen, BP chief US economist and head of oil and refining, speaking May 13 as a keynote at the Enverus Evolve oil and gas conference in Houston.
“The winners over the short term are those that have built up clean technology supply chains. Front and center is China,” Cohen said, noting that China is selling half of the “new energy” personal vehicles sold worldwide, led by BYD Auto and others.
Cohen projects that renewable energy’s share of the global energy marketplace will rise from about 15% now to 30% by 2050. Global oil demand likely will peak for good in about 10 years. And U.S. oil production may have plateaued for good near its current highs.
The U.S. and others risk failing “Econ 101” if they believe the renewable energy industry is dying just because of current supply chain and interest rate speed bumps, as well as political headwinds from the Trump administration for renewables, he said.
That doesn’t mean the U.S. is in a weak place, but it depends on China’s supply chains for solar, wind, and, especially, for battery parts for energy storage and EVs. Despite ebbs and flows, the costs for renewables and batteries should continue to fall, Cohen said, along with U.S. decarbonization efforts.
Amy Myers Jaffe, director of the Energy, Climate Justice, and Sustainability Lab at New York University, went a step further than Cohen.
China is building EVs that can charge in five minutes, Jaffe said, and, pretty soon, self-driving cars will charge themselves while you run errands.
The U.S. shouldn’t be worried about China trying to funnel cars into the U.S. through Mexico. The U.S. should be worried about trying to sell a gasoline-fueled Chevrolet Suburban that cost “six figures” (Chevy lists the 2025 Suburban price range from starting at $62,500 to fully loaded at well more than $100,000).
“The question is where will American car companies be able to sell a gasoline truck?” Jaffe asked. “How is that going to compete in the international marketplace with a $20,000 EV that can charge in five minutes. You need to ask yourselves that question.”
Climate change isn’t slowing down and changing societal behaviors and purchasing patterns are hard to predict, they said.
“The question is when does that inflection point happen? No one really knows,” Cohen said.
“It doesn’t matter,” Jaffe countered, citing the timing and Trump’s political actions against renewables. “The Chinese are coming out with vehicles that are less expensive that are going to eventually be able to charge in five minutes.”
China also is winning in the seas, Jaffe said.
“China is now the largest shipbuilder in the world,” she said, and it’s focused on utilizing low-carbon marine fuels, which other countries haven’t prioritized. “And they’re updating their major ports, like in Shanghai and other ports, to include low-carbon alternatives.”
While gas production is bullish in the U.S. amid construction booms for data centers and liquefied natural gas export plants, Jaffe also warned that data centers may not rely on natural gas power as much as anticipated.
“You can’t really build a new, natural gas thermal plant in the United States in a year,” Jaffe said, citing concerns on the timing of building new power infrastructure. “But you could throw some batteries on the grid.”
This story was originally featured on Fortune.com
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