IEA predicts the crude demand will slow as of 2025

The International Energy Agency predicts that global crude demand will drop as of 2025, due to greater fuel efficiency and the rise of electric vehicles.

In its World Energy Outlook 2019 with forecasts up to 2040, the agency revealed that the growth of demand will continue to increase in spite of the significant deceleration expected for 2030.

There is a gap between the expectations of a quick energy transition led by renewables and the reality of the current energy systems in which “reliance on fossil fuels remains stubbornly high,” the Agency stated.

If we remain on the “current global path,” it says, without additional policy changes, energy demand will increase by 1.3% each year until 2040, with increasing demand for energy services unrestrained by further efforts to improve efficiency.”

Crude demand

In its energy scenarios for the next twenty years, the IEA expects crude demand will increase by an average of nearly 1 million barrels per day (bpd) each year until 2025, from the 97 million bpd recorded in 2018.

In the mid-term, it forecasts a rise by an average 0.1 million bpd per year in the 2030 decade, reaching 106 million bpd in 2040.

Growing U.S. production

The United States shale oil production will remain high for some time, reshaping global markets, trade flows, and security.

“Annual US production growth slows from the breakneck pace seen in recent years, but updated official estimates of underlying resources nonetheless mean that the United States accounts for 85% of the increase in global oil production to 2030 in the Stated Policies Scenario, and for 30% of the increase in gas. This bolsters the position of the United States as an exporter of both fuels. By 2025, total US shale output (oil and gas) overtakes total oil and gas production from Russia,” the report adds.

Higher U.S. output pushes down the share of OPEC countries and Russia in total oil production. This share drops to 47% in 2030, from 55% in the mid-2000s; implying that efforts to manage conditions in the oil market could face strong headwinds.

Pressures on the hydrocarbon revenues of some of the world’s major producers also underline the importance of their efforts to diversify their economies.

Minor advances

In the report’s Stated Policies Scenario, energy demand increases by 1% a year until 2040. Low-carbon sources, led by photovoltaic power, account for more than half of this growth while natural gas, boosted by the increased use of liquefied natural gas (LNG), represents another third.

Some parts of the energy sector, namely electricity, are undergoing rapid transformations. Certain countries, especially those that aspire to achieve zero net emissions, are achieving great progress by reshaping all aspects of its consumption and supply.

Nonetheless, the World Energy Outlook 2019 indicates that promoting clean energy technologies is not enough to counter the effects of an expanding global economy and growing population.

The rise of emissions is decelerating but, with no peak before 2040, the world is still far from our shared sustainability targets, it adds.

For more information, check Energía16

See also: Experts call the IEA to approach global warming with greater force

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