Could oil be falling because of technology?

The Tesla Model S credit:wikimedia

We tend to take it for granted that demand for oil will keep growing till the world’s reserves run out. Oil however is only a means to an end. It’s value is in the energy it contains. So it's reasonable to believe that if alternative sources of energy and replacements for the machines that ran on petroleum are found, then the world won't need oil as much.

If an oil producer found out that oil demand will crash by say 2030, it would be in his interest to have other oil producers believe that there would be huge demand for oil in 2030 or at least not know about the crash. This way, he can increase his output and sell off his oil while other oil producers hoping to exploit the supposed high demand in 2030 limit their production keeping the price relatively high while he sells. Based on this, here’s my hypothesis (grain of salt advised);

Some in the oil industry have realised that current trends in technology and alternative energy might wean the world off of oil before the oil runs out. To ensure they are not left holding oil no one wants, they've decided to make sure the reserves they have a stake in are sold off by the time the world decides it doesn't need oil anymore. They've ramped up oil output and are counting on the crisis in the middle east to keep the price from dropping too much too fast. A few other people in the global oil industry have come to a similar conclusion, but no one is talking about it because if everyone knows, they'll all increase production and prices will drop too fast. This is why Saudi Arabia is not reducing output to hold up the price. They are also trying to sell off as much of their reserves as possible without alerting the rest of the world.

If this is the case then the end result will be that the few countries that can meet world demand at the lowest cost of production will likely soon be the only ones exporting oil. The likes of Venezuela (and Uganda?) that require oil to be above 100$ a barrel will be unable to make money from their reserves. It might also mean that oil might never be profitable for Uganda to export unless we can pull off the miracle of having one of the most cost effective production processes.

So the question now is this: Is there any evidence out there that shows that the world might get over oil before reserves ran out? I believe so, and it's all to do with the research in renewables and alternative energy. Here are the signs of the end for fossil fuels.

Renewables

In the next 10 years Germany intends to produce 40-45% of its electricity from renewable sources. Wind power in the Nordic and Baltic states is set to significantly drive down the demand for fossil fuel based energy sources. There are solar energy breakthroughs and innovations coming through at a faster pace than ever. One study by Deutsche Bank predicts that solar energy will be competitive with fossil fuels by 2016.

Batteries

Oil has one key advantage over most renewable sources of electricity storage and energy density. Electric batteries just don't have the energy density of oil products. Thus Petrol cars still have more range than their all electric counterparts. This is set to change soon however due to what's happening in the world of batteries. Here's a quick list of battery news mostly from the last 6 months.
Tesla is targeting to reduce the cost of EV batteries by 30% with its Giga Factory by 2020. Fuel and maintenance costs for EV batteries and motors are already much lower than for combustions engines. Some analysts believe that if tesla surpases its 30% target and the cost of batteries drops to around 100$/KWh, then EVs will be cost competitive with combustion engine vehicles.
A problem with Lithium ion batteries is the time it takes to recharge. Thanks to researchers in Singapore, that's a problem that will be all but solved shortly. Nanyang Technological University (NTU) in Singapore has developed a lithium ion battery that can be recharged to 70% capacity in just 2 minutes. The battery also has a lifetime thats up to 20 times longer than that of current Lithium ion batteries. Even better, the manufacturing process for this battery is compatible with that of current batteries. It also replaces the graphite anode with the cheaper titanium dioxide (Titanium is the 9th most abundant element in the earths crust carbon is 15th). Don't be too surprised if Tesla includes this in it's Giga factory.
Another notable breakthroughs came from Stanford University team with a design that could triple the capacity of existing lithium ion batteries.

Electric Vehicles

Back in June, Tesla open sourced all its patents. This is significant because it means that other car manufacturers can use Tesla developed technologies to build their own EVs without fear of patent infringement suits or costly licensing fees. And with tesla patents out there for the taking it's no wonder other manufacturers are considering building all electric EVs as well. Tesla itself plans to be producing half a million cars a year by 2020.

All this means there is a chance demand for internal combustion engines might start to fall as more and more people buy electric. Currently, more than half of crude oil refinery products ends up in internal combustion engines.

Fusion

There's been significant developments in nuclear fusion as an alternative energy source this year. From the controversial Energy Catalyser of Andrea Rossi that many say is just too good to be true; to LPP fusion's focus fusion and Lockheed Martin's Compact Fusion. All of these are to be more compact and orders of magnitude less costly than the 20 billion dollar ITER that most believed would be the first to reliable fusion power. Lockheed Martin in particular is promising market readiness as in soon as a decade. 

Fission

Regular nuclear fission isn't standing still either. Leslie Dewan's transatomic power is designing a Molten salt reactor that consumes nuclear waste. TerraPower a company Bill Gates has invested in is developing a Travelling Wave reactor that needs to be refuelled only once every 30 to 40 years and reduces nuclear waste by consuming depleted Uranium. Toshiba's 4S  reactor is a small reactor that is inherently safe and also doesn't require refuelling for up to 30 years. Other companies such as NuScale Power, Gen4Energy and Babcock &Wilcox are also working on the next generation of safe, modular reactors. Some of which are small enough to fit on the back of a truck.
With modular nuclear actually surpassing the energy density of petroleum, certain remote areas in the developing world might already find nuclear the cheaper energy option.

If oil producers believe that new technology is moving fast enough to replace oil before the oil runs out then the oil producers will try to sell off their oil before technology makes oil obsolete. Because of this, long before a technology actually hits the market, it could actually crash global oil prices, as long as people believe it will work. I've probably gotten a couple of things wrong, but its always fun to theorise