The Organization of the Petroleum Exporting Countries (OPEC) has released its latest annual report on the outlook for oil demand, forecasting a steady increase in global oil demand through at least 2050.
OPEC Secretary General, Haitham Al Ghais, said global oil demand is expected to rise by 18.6% from 103.7 million barrels per day (mbd) in 2024 to around 123 mbd in 2050.
Ghais attributed the growing demand to several factors, including expanding economic growth among others, arguing that the narrative of rapidly phasing out oil and gas is “unworkable” and a “fantasy.”
He further noted that fossil fuels still account for around 80% of the global fuel mix, little changed from when OPEC was founded in 1960.
According to Ghais, many timelines to reach net-zero carbon emissions have “little regard for energy security, affordability or feasibility.”
OPEC’s forecast puts the organisation at odds with the IEA, which predicts that global oil demand would begin to decline in 2030 due to the rise of electric cars and a shift away from crude oil to produce power.
The IEA also expected oil demand to drop in OPEC member countries like Saudi Arabia as they transition to gas and renewable energy.
OPEC’s forecast has significant implications for the energy industry, suggesting that oil will remain a dominant source of energy for the foreseeable future.
This could influence investment decisions and shape the trajectory of the energy transition.
While OPEC’s forecast suggested that oil demand would continue to grow, experts argued that a rapid phase-out of fossil fuels was necessary to keep global warming to 1.5 degrees Celsius above pre-industrial levels.
The debate highlighted the complexity and challenges of balancing energy security, affordability, and sustainability.
AFP
