Forecast by the International Energy Agency
The International Energy Agency (IEA) has confirmed in its recently published medium-term outlook that global oil demand is expected to peak by the end of the decade. Specifically, the IEA predicts that worldwide oil demand will rise to about 105.6 million barrels per day (bpd) by 2029, before slightly declining to around 105.5 million bpd in 2030.
Relevance for Investors and the Energy Sector
This forecast is particularly important for investors and the energy sector, as it indicates an impending turning point in oil demand growth. China, the world’s largest oil importer, anticipates its demand peak as early as 2027. This is largely due to the increasing adoption of electric vehicles and alternative modes of transportation. On a global scale, however, the peak is expected to occur only towards the end of the decade. In the United States, slower adoption of electric vehicles and lower gasoline prices continue to support oil consumption.
Differing Views
The IEA’s assessment contrasts with that of OPEC, which expects a prolonged growth in demand and does not foresee an imminent turning point. The IEA also highlights geopolitical risks, such as conflicts in the Middle East, as uncertainties for the oil market, but assumes that oil supply should remain sufficient until 2030.
Implications for Investors
- Short- to medium-term: Continuing demand growth could lead to stable or rising oil prices.
- Long-term from around 2030: A decline in demand could create price pressures or enhance investments in alternative energies.
- Geopolitical risks: These could cause short-term price fluctuations.
Overall, the IEA forecast signals an upcoming turning point in global oil demand with significant implications for price development and strategies in the energy sector.