Every year, the world uses roughly 37 billion barrels of oil. Most is burned to power cars, trucks, planes, ships and other types of transport. For more than a century, this energy-dense hydrocarbon has shaped the modern world, from geopolitics to electricity systems.

But this dependence on oil for transport comes with clear vulnerabilities. Combustion engines burning petrol, diesel or gas worsen climate change. Oil accounts for a third of all greenhouse gas emissions from fuel. Many countries rely on oil imports, which means oil has to be extracted and shipped long distances. Right now, oil prices are soaring after Iran closed the Strait of Hormuz, through which 20% of the world’s oil and gas is shipped. In response, governments may have to release strategic reserves, while stock markets have fallen and analysts are warning of sudden inflation.

As electric vehicles rise to 25% of new car sales globally, demand for oil as a fuel is expected to plateau and eventually decline. We can already see this in China’s very rapid shift to electric vehicles, trucks and bullet trains, which has slowed its oil demand growth.

This doesn’t mean an end to oil. We will likely need it as a raw material for useful products for decades yet. The International Energy Agency predicts petrochemicals will become the main driver of demand this........

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