In a world that wants to move beyond hydrocarbons, Oil demand forecasting is becoming increasingly complex and subject to debate. Just look at the various forecasts from the International Energy Agency (IEA) and the OPECtwo organizations that should theoretically know where the oil markets are going.
The IEA forecasts moderate growth of 770,000 barrels per day (b/d) by 2026.which would bring demand to around 106 million barrels per day, up from about 10 million barrels per day more than a decade ago. OPEC is more optimistic, expecting an increase of between 1.3 and 1.4 million b/dwhile the United States Energy Information Administration (RRP) expects growth of 1.1 million barrels per day. This gap is notable considering the short time horizon of just one year. Highlights the difficulties in predicting demand in the context of Changes in politics, technology and sustainability effortsmaking the future of oil dynamic and uncertain.
If a 12-month horizon is already difficult, how about a 25-year horizon? Last month the IEA published its long-term report World Energy Outlook 2025Scenarios range from robust oil demand to sharp structural declines. When you add the forecasts from global energy companies and agencies, the developments appear even more bullish and pessimistic than those of the IEA. The divergence is almost cinematic: future prospects confidently projected, but not yet tested.
Even so, Many expect a drastic decline within 25 years. But is it realistic if the global infrastructure is still based on hydrocarbons?
History remembers how difficult it is Leave entrenched infrastructures that have been used for centuries in search of alternatives. In the decade of 1850before the discovery of crude oil in 1859 in Titusville, Pennsylvania, Whale oil dominated lighting and lubrication. At the time, sperm whale oil was considered clean and flammable and was used to lubricate watches, firearms and other mechanisms. Oil from humpback, blue, fin, northern and right whales was of lower quality and was used more cheaply for lighting purposes, among other things. Although the United States whaling fleet was dominant, The country continued to import significant amounts of whale oil from other countries such as the United Kingdom and France..
However, the United States was heavily dependent on whale oil Imports fell over decades as domestic crude oil production grew. In the 20th century, imports of whale oil were minimal and limited primarily to ceremonial or special purposes. What lesson can be learned today from its decline?
That’s the first lesson a decline in demand an energy source during a transition does not mean that this demand will collapse immediately. Imports of whale oil began to decline before the discovery of oil in 1859, but It took about 50 years for them to become insignificant. Even half a century later, the United States was still importing whale oil’s worth 5% of 1859 levels. To put it simply, converting energy systems takes a long time.
This is the second lesson A slowdown in demand growth in an energy industry does not mean that prices and volatility will disappear. As the sector shrinks, investment in supply declines due to uncertainty, leading to price increases and greater volatility for consumers who continue to rely on this input. In the case of whale oil, imports began to decline in the 1850s, but prices remained volatile and They only returned to normal after 50 years.
Since 1859 a huge infrastructure based on hydrocarbons that shape energy, transport and the economy. Although technological innovations are advancing faster today, large-scale replacement with alternatives such as Solar or nuclear energy It will not happen overnight – or even within 25 years – in a way that significantly changes the energy matrix. A rapid shift away from hydrocarbons is unlikely, especially if emerging markets remain dependent on fossil fuels. Given this uncertainty Can future oil demand at least be estimated?
Predicting oil demand based on population is incomplete but offers clues. Historically, global oil demand growth has tracked closely Population growthas more people means more energy consumption for transport, heating, electricity, industry and economic activity. Using UN demographic forecasts, Demand could reach 108.6 million barrels per day in 2030, 116 million barrels per day in 2040 and 122 million barrels per day in 2050compared to about 105 million b/d today. However, due to climate policy, this simplified model alone is inadequate.
He World Energy Outlook the IEA collects two possible outcomes. The first is a “current political scenario”that reflects current measures and projects whose demand will increase up to 113 million barrels per day in 2050. The second is a “decided policy scenario” covering a broader range of initiatives and meeting demand a peak in 2030 and then fall to 97 million barrels per day in 2050.
These are very different futures for oil. Energy companies in the US and Europe also show different views on future demand. On the whole, The forecasts are between 88 and 113 million barrels per day. In my opinion, demand for oil is at an end By 2050, the amount is likely to be closer to 115 million barrels per day. Of course, this is all still an educated guess. With so much uncertainty and conflicting visions, adaptive thinking is essential when forecasting energy demand.
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