The boost to oil demand growth from the post-pandemic recovery is set to end this year, the International Energy Agency (IEA) said on Wednesday (June 14), with economic challenges and the transition to cleaner fuels sapping growth from 2024.
“The shift to a clean energy economy is picking up pace, with a peak in global oil demand in sight before the end of this decade as electric vehicles, energy efficiency and other technologies advance,” said IEA executive director Fatih Birol.
Global oil demand will grow by 2.4 million barrels per day (bpd) in 2023 to a record 102.3 million bpd, the IEA said in its monthly report on Wednesday.
However, the agency expects economic headwinds to reduce growth to 860,000 bpd next year and increasing use of electric vehicles to help to reduce that to 400,000 bpd in 2028 for overall demand of 105.7 million bpd.
“The slowdown has been hastened by Russia’s invasion of Ukraine amid heightened energy security concerns and by governments’ post-Covid recovery spending plans, with more than US$2 trillion (RM9.2 trillion) mobilised for clean energy investments by 2030,” the IEA said.
Demand for oil from combustible fossil fuels, excluding biofuels, petrochemical feedstocks and other non-energy uses, is set to peak at 81.6 million bpd in 2028, it added. – Reuters.
