The really insurmountable problem for the Tesoro-Savage oil terminal is that the global oil market has changed. Forever.
Bloomberg New Energy Finance notes that we now have a worldwide surplus of energy. New sources of oil have increased supply, while vehicles with higher efficiencies or zero emissions are destroying oil demand. Capital investments for renewables now surpass capital spending at oil and gas companies.
Bloomberg forecasts that by 2023, electric vehicles (EVs) will reach cost parity on capital cost alone, and EVs are already far cheaper to fuel and maintain. By 2023, EVs will have grown to displace about 2 million barrels of daily demand. That approximates the current glut that is depressing oil prices. By 2040, half of all new cars could be electric.
Oil prices will generally decline from extra supply and decreasing demand. Oil will do what coal is doing now, but with a louder crash. Since 2012, 50 U.S. coal companies and 69 oil and gas companies have gone bankrupt.
A big oil terminal would become a stranded asset within about 15 years. Longview has a simpler terminal decision — the coal companies have bailed out, creating a stranded asset even before the environmental impact statement is done.
