How the post-coronavirus shift to remote work could impact oil demand
Facebook CEO Mark Zuckerberg said Thursday that the company is planning to shift the majority of its workforce to be able to work remotely in the next 5 to 10 years.
The state of play: It's the latest sign that remote work could become a permanent fixture of the post-pandemic landscape for substantial numbers of people whose jobs enable that luxury. That, in turn, is among the things that may act as a drag on long-term oil demand if many large employers go the same route.
- Twitter and Square, both run by Jack Dorsey, announced last week that people could work from home indefinitely if they wanted to.
But, but, but: Gaming out whether the coronavirus pandemic, which has sharply reduced oil consumption, is a blip or inflection point is really hard.
- Demand is already coming back significantly since last month when it was down by roughly 30%.
What they're saying, via S&P Global Platts: BP chief economist Spencer Dale points out that while people are traveling less, the crisis could boost consumption in other ways.
- From their piece on his interview with IHS Markit: "Dale said it...remains unclear whether social behavior changes post-pandemic might mitigate any slide in oil intensity from less travel."
- "More home deliveries of food and goods in addition to greater private car use to avoid public transport could push demand in the other direction," he said.
The big picture: Overall, Dale sees the pace and degree of economic recovery having a vastly larger effect on future oil demand than new travel patterns.