The Original Analysis
Bloomberg’s piece, titled “Here’s How Electric Cars Will Cause the Next Oil Crisis,” laid out a simple but powerful framework.
By 2020, it argued, certain EVs would already be faster, safer, cheaper, and more convenient than gas-powered cars.
To highlight oil’s fragility, the article pointed back to the 2014 crash. That collapse had been triggered by just 2 million barrels per day of oversupply.
Oil markets, the author explained, are extremely sensitive to even small shifts in demand.
From this, the projection followed: by 2023, EVs could displace more than 1 million barrels of oil per day, creating conditions ripe for another crash.
Although that scenario didn’t materialize, by 2024 Bloomberg expected about 1.3 million barrels displaced. The middle-case outlook pointed more convincingly to 2025 as the true turning point.
Still, the author noted one major obstacle. Oil companies would not simply stand by. Instead, they would likely restrict supply to maintain stability and keep prices propped up.
Why $BadPetrol
This analysis became the backbone for my own ETF, $BadPetrol. In essence, it was a strategic bet against traditional oil demand, built around the same thesis Bloomberg had outlined.
Seeing It in Real Life
What struck me most was how this theory matched what I was witnessing on the ground.
A few years ago in Mexico City, spotting a BYD taxi was about as rare as seeing a Tesla. Today, however, the picture looks completely different.
Roughly one in ten cars I see is a BYD—and some days it feels closer to one in eight. Their budget EV, the Dolphin, seems to be everywhere.
Here’s the irony: BYD is now the largest EV seller in the world, yet investors on Dub can’t trade BYDDY stock directly.
So when I built out the Chinese EV portion of $BadPetrol, I turned instead to the trio of Li Auto, NIO, and XPeng. Unlike BYD, they are widely available on trading platforms, and they’re making real progress in global markets.
Building $BadPetrol
To start, I anchored the fund with a contrarian play: DRIP, the 2x bear oil ETF. The logic was straightforward. If oil demand collapsed, DRIP would benefit directly.
However, there were two problems. First, oil prices are notoriously volatile, which creates the risk of large short-term losses. Second, 2x ETFs tend to lose value over time because of compounding effects. Both of these issues made DRIP a poor long-term choice.
Recognizing this, I shifted into a broader strategy. The portfolio began to include:
- Energy transition plays
- Battery technology stocks
- A greentech ETF
- U.S. EV companies
My approach stayed consistent. Using technical indicators, I sold when stocks looked overbought and bought when they were oversold. I made sure to take profits during rallies and add positions during dips.
The Evolution
What began as a simple “end of oil” trade gradually became more balanced. Over time, the portfolio grew into a mix of defensive and growth positions, better suited for the broader energy transition.
Chinese EV stocks, in particular, proved highly volatile. Ironically, that volatility worked in my favor, since it fit perfectly with a disciplined buy-low-sell-high strategy.
Reality Check
So, did Bloomberg’s 2024 prediction play out? The short answer is no—not yet.
Oil didn’t collapse on schedule, and the monthly demand shocks never showed up. But that doesn’t mean the thesis failed. Timing S-curves has always been difficult.
What is clear today is that adoption continues to accelerate. In China especially, BYD has become dominant. Infrastructure keeps expanding, technology keeps improving, and costs continue to fall year after year.
Meanwhile, oil companies are responding in predictable ways. Rather than overproducing, they are scaling back investment and supply, hoping to keep prices relatively high even as demand slowly erodes.
The Road Ahead
Whether oil’s downfall comes in 2025, 2026, or later, the trajectory feels inevitable.
So far, $BadPetrol has returned about 30% since February. On several occasions, it has even landed on Dub’s daily top-earner list.
Nevertheless, the ETF only manages around $4,000 in outside assets. Strong performance alone doesn’t guarantee large inflows, particularly for contrarian strategies. And unlike a traditional fund, $BadPetrol competes directly with other active copy traders.
The experiment, however, continues. The EV wave grows larger every month. And as the energy transition unfolds, $BadPetrol will keep adapting to ride that shift.
