Liam Denning / Bloomberg Hyperdrive: Big oil and Amazon
Big oil should be worried about Amazon's battery play.
The last bastion of the fossil fuel industry was just breached.
While you were busy reading Elon Musk's tweets , Audi AG was unveiling its Tesla challenger, the E-tron . One of the most interesting bits of the glitzy launch concerned simply plugging the thing in: The carmaker, it turns out, has teamed up with Amazon.com Inc. to install home chargers for E-tron buyers.
While Amazon helping to get new plugs put into garages may not scream revolution, it should still worry the likes of Exxon Mobil Corp. The oil industry has long been more concerned with generating supply than encouraging demand—why bother, when drivers had no alternative? The hassle of charging has long been one of the things holding back the electrical vehicle market. Amazon's entry will make that a whole lot easier, potentially representing a major threat in oil's biggest market.
The fossil fuel industry should be worried about a company such as Amazon encroaching on its territory. Back in the summer of 2008, three of the world's five most valuable companies produced oil and gas. Exxon was No. 1. Today, four years after a global collapse in oil prices, Big Tech dominates and Exxon struggles to stay in the top 10 .
Amazon momentarily puzzled investors in June 2017 when it announced it would spend $14 billion on the grocery chain Whole Foods; its stock has virtually doubled since. Bubbly this may be, but that's beside the point: If you're reading this online, you're enjoying the legacy of one of the biggest bubbles ever. What matters is that Amazon has taken a toehold in yet two more businesses: energy and transportation. Its shareholders won't care, but Big Oil should.
? Alexa, Can You Charge My Car?
Speaking at a London conference, Nathaniel Bullard of Bloomberg New Energy Finance listed some ways Amazon might make EV ownership more attractive. What if Alexa could place your Whole Foods order while you were on your way to the store? Or start charging your car when electricity prices are lowest?
? Reined In
Spending on upstream oil and gas development has declined by $308 billion since 2014. Why invest so much in reserves if demand for oil might falter?
? Over the Top
Ten years ago, the phrase “peak oil” referred to supply. Today it's more often used in the context of peak demand—a much less cheery prospect for the fossil fuel industry.
? Big Oil Meets Big Tech
In the summer of 2008 fossil fuel companies ruled the capital markets. Today they're lucky if they can still compete with the biggest players, almost all of which serve the digital economy.
Liam Denning is a Bloomberg Opinion columnist covering energy, mining and commodities. He previously was editor of the Wall Street Journal's Heard on the Street column and wrote for the Financial Times' Lex column. He was also an investment banker. Petroleumworld does not necessarily share these views.
Editor's Note: This article was originally published by Bloomberg, Oct 08 , 2018 . All comments posted and published on Petroleumworld, do not reflect either for or against the opinion expressed in the comment as an endorsement of Petroleumworld.
Use Notice: This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of issues of environmental and humanitarian significance. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml.
PW 300.000 plus request per week
Hit your target - Advertise with us
All works published by Petroleumworld are in accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. Petroleumworld has no affiliation whatsoever with the originator of this article nor is Petroleumworld endorsed or sponsored by the originator. Petroleumworld encourages persons to reproduce, reprint, or broadcast Petroleumworld articles provided that any such reproduction identify the original source, http://www.petroleumworld.com or else and it is done within the fair use as provided for in section 107 of the US Copyright Law.
If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner. Internet web links to http://www.petroleumworld.com are appreciated.
Petroleumworld Copyright© 1999-2018 Petroleumworld or respective author or news agency. All rights reserved.
We welcome the use of Petroleumworld™ stories by anyone provided it mentions Petroleumworld.com as the source. Other stories you have to get authorization by its authors.
Internet web links to http://www.petroleumworld.com are appreciated.
Petroleumworld welcomes your feedback and comments, share your thoughts on this article, your feedback is important to us!
Petroleumworld News 10 /10/2018
We invite all our readers to share with us
their views and comments about this article.
Send this story to a friend Write to firstname.lastname@example.org
By using this link, you agree to allow PW
to publish your comments on our letters page.
Any question or suggestions,
please write to: email@example.com
Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8 +/ 800x600 pixels