High pump prices drive electric-vehicle advances
THE DEATH knell of the internal-combustion engine may not be sounding just yet, but oil producers must plan pricing strategies carefully if they are to avoid derailing growth in petroleum-powered transport
Rising incomes are leading to massive growth in the use of private transport in countries such as China, India and Brazil, but, while that means a rise in demand for petroleum products in the short-term, it also means the share of consumers' expenditure being spent on transport fuel is rising. Bassam Fattouh, director of the Oil and Middle East Programme at the Oxford institute for Energy Studies, argues that this is creating a new wave of vehicle owners whose decision-making on transport will become increasingly, heavily influenced by the cost of fuel. "These consumers, spending more and more on gasoline, will become increasingly sensitive to price effects," Fatouh told an energy conference
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