Global oil demand will peak at 102 million barrels per day (bpd) in 2028, Rystad Energy said on Monday, noting that the push to low-carbon energy and the coronavirus pandemic will speed up the peak oil demand timeline to 2028 from 2030 previously expected.
Before the pandemic upended forecasts for oil demand for both the short and long term, Rystad Energy had expected the maximum world oil demand to hit 106 million bpd in 2030.
According to the energy research and business intelligence company, it will not be until 2023 that global oil demand recovers to the pre-pandemic levels. In 2023, oil demand is seen at 100.1 million bpd, surpassing the 99.6 million bpd demand in 2019.
This year, global oil demand will slump to 89.3 million bpd. The recovery will be slow next year amid regional lockdowns and a sluggish recovery in the aviation industry, Rystad Energy said.
“Overall, we do not believe Covid-19 has put peak oil demand behind us, but we do acknowledge the pandemic will greatly alter the peak oil demand reckoning moment, both in terms of timing and volumes,” Artyom Tchen, Senior Oil Markets Analyst at Rystad Energy, said in a statement.
In 2050, oil demand is expected to significantly decline to 62 million bpd due to the expected high market share of electric vehicles (EVs), Rystad said.
Analysts and oil majors have recently said that the pandemic and the possible lasting shift of consumer behavior may have already brought peak oil demand. Related: Can Ecuador Save Its Ailing Oil Sector?
Globally, we may have passed peak oil demand last year, as fuel consumption may never recover from the pandemic-inflicted decline, BP said in its annual outlook in September.
OPEC, for its part, is way more conservative in its latest estimates, although it also revised down its projections last month and said that even after oil demand peaks, it would not fall off a cliff afterward. OPEC expects global oil demand will exceed the pre-pandemic levels in 2022 and grow steadily until the late 2030s when it will begin to plateau.
Saudi Arabia and its oil giant Aramco continue to say that peak oil demand is still nowhere in sight and that the world will need oil and gas for the foreseeable future, regardless of estimates by analysts and even OPEC that global oil demand will start to plateau and decline at some point in the late 2030s.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com: