It’s challenging to get ahead, but it’s even harder to stay ahead.
For companies looking to create a sustainable competitive advantage in a fast-moving, capital intensive, and nascent sector like manufacturing electric vehicles, this is a simple reality that must be accounted for.
Every milestone achieved is met with the onset of new and more sophisticated competitors – and as the industry grows, the stakes grow higher and the market gets further de-risked. Then, the real 800-lb gorillas start to climb their way in, making competition even more fierce.
Visualizing U.S. EV Sales
Today’s animation uses data from InsideEVs to show almost nine years of U.S. sales in the electric vehicle market, sorted by model of car.
It paints a picture of a rapidly evolving market with many new competitors sweeping in to try and claim a stake. You can see the leads of early successes eroded away, the increasing value of scale, and consumer preferences, all rolled into one nifty animation.
The Tesla Roadster starts with a very early lead, but is soon replaced by the Nissan Leaf and Chevrolet Volt, which are the most sold models in the U.S. from 2011-2016.
Closer to the end, the Tesla Model S rises fast to eventually surpass the Leaf by the end of 2017. Finally, the scale of the rollout of the Tesla Model 3 is put into real perspective, as it quickly jumps past all other models in the span of roughly one year.
The Gorilla Search
While Tesla’s rise has been well-documented, it’s also unclear how long the company can maintain an EV leadership position in the North American market.
As carmakers double-down on EVs as their future foundations, many well-capitalized competitors are entering the fray with serious and ambitious plans to make a dent in the market.
In the previous animation, you can already see there are multiple models from BMW, Volkswagen, Honda, Fiat, Ford, Toyota, Nissan, and Chevrolet that have accumulated over 10,000 sales – and as these manufacturers continue to pour capital in the sector, they are likely posturing to try and find how to create the next mass market EV.
Of these, Volkswagen seems to be the most bullish on a global transition to EVs, and the company is expecting to have 50 fully electric models by 2025 while investing $40 billion into new EV technologies (such as batteries) along the way.
The Chinese Bigfoot?
However, the 800-lb gorilla could come from the other side of the Pacific as well.
Source: The Driven
Chinese company BYD – which is backed by Warren Buffett – is currently the largest EV manufacturer in the world, selling 250,000 EVs in 2018.
The Chinese carmaker quietly manufacturers buses in the U.S. already, and it has also announced future plans to sell its cars in the U.S. as well.
How will such an animation of cumulative U.S. EV sales look in the future? In such a rapidly evolving space, it seems it could go any which way.
Mapped: The World’s Largest State-Owned Oil Companies
State-owned oil companies control roughly three-quarters of global oil supply. See how these companies compare in this infographic.
Mapped: The World’s Largest State-Owned Oil Companies
View the high-resolution of the infographic by clicking here.
Oil is one of the world’s most important natural resources, playing a critical role in everything from transportation fuels to cosmetics.
For this reason, many governments choose to nationalize their supply of oil. This gives them a greater degree of control over their oil reserves as well as access to additional revenue streams. In practice, nationalization often involves the creation of a national oil company to oversee the country’s energy operations.
What are the world’s largest and most influential state-owned oil companies?
Editor’s Note: This post and infographic are intended to provide a broad summary of the state-owned oil industry. Due to variations in reporting and available information, the companies named do not represent a comprehensive index.
State-Owned Oil Companies by Revenue
National oil companies are a major force in the global energy sector, controlling approximately three-quarters of the Earth’s oil reserves.
As a result, many have found their place on the Fortune Global 500 list, a ranking of the world’s 500 largest companies by revenue.
|Country||Name||Fortune Global 500 Rank||2019 Revenues|
|🇨🇳 China||Sinopec Group||2||$443B|
|🇨🇳 China||China National Petroleum Corporation (CNPC)||4||$379B|
|🇸🇦 Saudi Arabia||Saudi Aramco||6||$330B|
|🇮🇳 India||Indian Oil Corporation (IOCL)||151||$69B|
|🇮🇷 Iran||National Iranian Oil Company (NIOC)||Not listed||$19B*|
|🇻🇪 Venezuela||Petróleos de Venezuela (PDVSA)||Not listed||$23B (2018)|
*Value of Iranian petroleum exports in 2019. Source: Fortune, Statista, OPEC
China is home to the two largest companies from this list, Sinopec Group and China National Petroleum Corporation (CNPC). Both are involved in upstream and downstream oil operations, where upstream refers to exploration and extraction, and downstream refers to refining and distribution.
It’s worth noting that many of these companies are listed on public stock markets—Sinopec, for example, trades on exchanges located in Shanghai, Hong Kong, New York, and London. Going public can be an effective strategy for these companies as it allows them to raise capital for new projects, while also ensuring their governments maintain control. In the case of Sinopec, 68% of shares are held by the Chinese government.
Saudi Aramco was the latest national oil company to follow this strategy, putting up 1.5% of its business in a 2019 initial public offering (IPO). At roughly $8.53 per share, Aramco’s IPO raised $25.6 billion, making it one of the world’s largest IPOs in history.
Because state-owned oil companies are directly tied to their governments, they can sometimes get caught in the crosshairs of geopolitical conflicts.
The disputed presidency of Nicolás Maduro, for example, has resulted in the U.S. imposing sanctions against Venezuela’s government, central bank, and national oil company, Petróleos de Venezuela (PDVSA). The pressure of these sanctions is proving to be particularly damaging, with PDVSA’s daily production in decline since 2016.
In a country for which oil comprises 95% of exports, Venezuela’s economic outlook is becoming increasingly dire. The final straw was drawn in August 2020 when the country’s last remaining oil rig suspended its operations.
Other national oil companies at the receiving end of American sanctions include Russia’s Rosneft and Iran’s National Iranian Oil Company (NIOC). Rosneft was sanctioned by the U.S. in 2020 for facilitating Venezuelan oil exports, while NIOC was targeted for providing financial support to Iran’s Islamic Revolutionary Guard Corps, an entity designated as a foreign terrorist organization.
Like the rest of the fossil fuel industry, state-owned oil companies are highly exposed to the effects of climate change. This suggests that as time passes, many governments will need to find a balance between economic growth and environmental protection.
Brazil has already found itself in this dilemma as the country’s president, Jair Bolsonaro, has drawn criticism for his dismissive stance on climate change. In June 2020, a group of European investment firms representing $2 trillion in assets threatened to divest from Brazil if it did not do more to protect the Amazon rainforest.
These types of ultimatums may be an effective solution for driving climate action forward. In December 2020, Brazil’s national oil company, Petrobras, pledged a 25% reduction in carbon emissions by 2030. When asked about commitments further into the future, however, the company’s CEO appeared to be less enthusiastic.
That’s like a fad, to make promises for 2050. It’s like a magical year. On this side of the Atlantic we have a different view of climate change.
— Roberto Castello Branco, CEO, Petrobras
With its 2030 pledge, Petrobras joins a growing collection of state-owned oil companies that have made public climate commitments. Another example is Malaysia’s Petronas, which in November 2020, announced its intention to achieve net-zero carbon emissions by 2050. Petronas is wholly owned by the Malaysian government and is the country’s only entry on the Fortune Global 500.
Challenges Lie Ahead
Between geopolitical conflicts, environmental concerns, and price fluctuations, state-owned oil companies are likely to face a much tougher environment in the decades to come.
For Petronas, achieving its 2050 climate commitments will require significant investment in cleaner forms of energy. The company has been involved in numerous solar energy projects across Asia and has stated its interests in hydrogen fuels.
Elsewhere, China’s national oil companies are dealing with a more near-term threat. In compliance with an executive order issued by the Trump Administration in November 2020, the New York Stock Exchange (NYSE) announced it would delist three of China’s state-run telecom companies. Analysts believe oil companies such as Sinopec could be delisted next, due to their ties with the Chinese military.
The Periodic Table of Commodity Returns (2021 Edition)
Which commodity had the best returns in 2020? From gold to oil, we show how commodity price performance stacks up over the last decade.
The Periodic Table of Commodity Returns (2011-2020)
Being a commodity investor can feel like riding a roller coaster.
Take silver. Typically known for sharp, idiosyncratic price movements, it faced double-digit declines in the first half of the decade, falling over 35% in just 2013 alone. By contrast, it jumped over 47% in 2020. Similarly, oil, corn, and others witnessed either steep declines or rapid gains.
The above graphic from U.S. Global Investors traces 10 years of commodity price performance, highlighting 14 different commodities and their annual ranking over the years.
Commodity Price Performance, From Best to Worst
Which commodities were the top performers in 2020?
The aforementioned silver tripled its returns year-over-year, climbing 47.9% in 2020. In July, the metal actually experienced its strongest month since 1979.
Along with silver, at least seven other commodities had stronger returns than the S&P 500 in 2020, which closed off the year with 16.3% gains. This included copper (26.0%), palladium (25.9%), gold (25.1%) and corn (24.8%).
Interestingly, copper prices moved in an unconventional pattern compared to gold in 2020. Often, investors rush to gold in uncertain economic climates, while sectors such as construction and manufacturing—which both rely heavily on copper—tend to decline. Instead, both copper and gold saw their prices rise in conjunction.
Nowadays, copper is also a vital material in electric vehicles (EVs), with recent demand for EVs also influencing the price of copper.
As investors flocked to safety, silver’s price reached heights not seen since 2010.
The massive scale of monetary and fiscal stimulus led to inflationary fears, also boosting the price of silver. How does this compare to its returns over the last decade?
In 2013, silver crashed over 35% as confidence grew in global markets. By contrast, in 2016, the Brexit referendum stirred uncertainty in global markets. Investors allocated money in silver, and prices shifted upwards.
As Gold as the Hills
Like silver, market uncertainty has historically boosted the price of gold.
What else contributed to gold’s rise?
- U.S. debt continues to climb, pushing down confidence in the U.S. dollar
- A weaker U.S. dollar makes gold cheaper for other countries to buy
- Low interest rates kept the returns of other safe haven assets low, making gold more attractive by comparison
Here’s how the price of gold has changed in recent years.
Gold faced its steepest recent declines in 2013, when the Federal Reserve bank discussed tapering down its quantitative easing program in light of economic recovery.
Hitting the Brakes On Oil
Oil suffered the worst commodity price performance in 2020, with -20.5% returns.
For the first time in history, oil prices went negative as demand plummeted. To limit its oversupply, oil producers shrunk investment, closed wells, and turned off valves. Unfortunately, many companies still faced bankruptcies. By November, 45 oil producers had proceeded with bankruptcy filings year-to-date.
This stood in stark contrast to 2019, when prices soared 34.5%.
As is custom for oil, prices see-sawed over the decade. In 2016 and 2019, it witnessed gains of over 30%. However, like 2020, in 2014 it saw huge losses due to an oversupply of global petroleum.
In 2020, total production cuts hit 7.2 million barrels a day in December, equal to 7% of global demand, in response to COVID-19.
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