Growth in global oil demand is expected to slow from 2025 as fuel efficiency improves and the use of electric vehicles increases, but consumption is unlikely to peak in the next two decades, the International Energy Agency said on Wednesday.
The Paris-based IEA, which advises Western governments on energy policy, said in its annual World Energy Outlook for the period to 2040 that demand growth would continue to increase even though there would be a marked slowdown in the 2030s.The agency’s central scenario - which incorporates existing energy policies and announced targets - is for demand for oil to rise by around 1 million barrels per day (bpd) on average every year to 2025, from 97 million bpd in 2018.
Demand is then seen increasing by 0.1 million bpd a year on average during the 2030s to reach 106 million bpd in 2040.
“There is a material slowdown after 2025, but this does not lead to a definitive peak in oil use,” the IEA said, citing increased demand from trucks and the shipping, aviation and petrochemical sectors.
This year, the IEA renamed its main scenario “Stated Policies”, instead of “New Policies”, to clarify that it reflects current policies. It is one of three scenarios used to show how energy demand could evolve over the next two decades.
The IEA has been criticised by groups concerned about climate change who say the outlook underplays the speed at which the world could switch to renewable energy and undermines efforts to keep increases in global temperatures within 1.5-2 degrees Celsius.