Global oil demand growth to slow from 2025: IEA

Pablo Tucker
November 15, 2019

These stark observations from the "World Energy Outlook 2019" report emulated that of the infamous IPCC report of 2018 that stated: "Limiting global warming to 1.5°C would require rapid, far-reaching and unprecedented changes in all aspects of society".

"We will need to see great political will around the world", Birol said.

Under the plan, the share of fossil fuels in the energy mix would drop from 81 percent previous year to 58 percent by 2040, compared with 78 percent on current and 74 percent on stated policies.

Under the report's stated policies scenario, which reflects today's policy intentions and targets, the increase in electric vehicle (EV) sales and more stringent fuel economy standards together lead to a peak in oil demand from passenger cars in the late-2020s. Some parts of the energy sector, led by electricity, undergo rapid transformations. The country's consumption will top out at 15.7 million barrels a day. And the upcoming population boom in cities across Africa and Asia.

"Shale output from the United States stays higher for longer, reshaping global markets, trade flows and security". However, it still accounts for 85% of the increase in global oil production to 2030, and for 30% of the increase in gas.

Russia's oil output will decrease from 11.5 million barrels per day in 2018 to 11.1 million barrels per day in 2025, and 9.4 million barrels per day in 2040, PRIME reported. Now, the technology is entering new regions. Also, the U.S. will account for 85 percent of the increase in global oil production by 2030, thanks to the shale boom.

The higher USA output pushes down the share of Organization of Petroleum Exporting Countries (OPEC) members and Russian Federation in total oil production, which drops to 47% in 2030, from 55% in the mid-2000s. But whichever pathway the energy system follows, the world is set to rely heavily on oil supply from the Middle East for years to come.

He called for a "grand coalition" of governments, industry and citizens to tackle climate change. "Our Sustainable Development Scenario is tailor-made to help guide the members of such a coalition in their efforts to address the massive climate challenge that faces us all".

Energy efficiency improvements would be the most effective action right now to bring the world towards the more desirable Sustainable Development Scenario, claimed the IEA, and yet, efficiency efforts are already slowing down.

Electricity is one of the few energy sources that sees rising consumption over the next two decades in the Sustainable Development Scenario. Electricity consumption would overtake that of oil by 2040 and, crucially, wind and solar PV would provide nearly all the increase in electricity generation.

SUVs, the World Energy Outlook 2019 notes, are more hard to electrify fully, while conventional SUVs consume 25% more fuel per kilometre than medium-sized cars.

The more ambitious scenario would also require work on new coal plants in Asia to capture their emissions, or closing those plants early. Oil Change International notably criticized the IEA's "over-reliance" on natural gas as a replacement for coal, saying that will lead to "climate chaos" because gas, too, contributes to emissions. "Unfortunately, the IEA has failed to convey the urgency of the situation", said Nathan Lemphers, senior campaigner at OCI.

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