International Energy Agency predicts peak oil demand before the end of the decade

The International Energy Agency (IEA) predicts that global oil demand will peak “before the end of the decade,” according to an annual report released this Wednesday that mentions a peak during this period for the first time.

“The transition to a clean energy economy is accelerating and global oil demand is expected to peak before the end of this decade as electric vehicles, energy efficiency and other technologies advance,” said AIE Executive Director Fatih Birol. statement.

In the Oil Report 2023, a five-year review of the market, the IEA estimates that global oil demand will continue to grow, but “this growth is expected to slow significantly until 2028.”

It happened sooner than expected: in a previous World Energy Outlook report published in 2022, the Paris-based IEA, a division of the OECD, noted that “global oil demand is recovering despite high prices, peaking and stabilizing after 2035 of the year”. .

According to these new medium-term five-year projections, “the use of oil as a transport fuel is expected to decrease” after 2026.

But that decline should be moderated by booming demand for petrochemicals and strong growth in consumption in emerging economies, which “more than offset” reduced demand in advanced economies, the IEA said.

“High energy prices” and “supply security issues highlighted by the global energy crisis,” exacerbated by the war in Ukraine, are accelerating the “transition to cleaner energy technologies,” the IEA said.

“Based on current government policies and market trends, global oil demand will grow by 6% between 2022 and 2028, reaching 105.7 million barrels per day, supported by strong demand from the petrochemical and aviation sectors,” IEA experts write.

“Despite this cumulative increase, annual demand growth is expected to decline from 2.4 million barrels per day this year to just 0.4 million barrels per day in 2028, indicating a peak in demand,” they say.