Less oil?: The energy transition will slow down the increase in demand from 2024, according to the IEA

First modification: 06/14/2023 – 19:51

A slowing economy and the transition to cleaner fuels will undermine hydrocarbon demand growth after 2024, according to the International Energy Agency.

In its semi-annual report on the medium-term oil market, the agency predicted that “the shift to an economy based on clean energy is gaining 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.

The agency’s executive director, Fathi Birol, added that, particularly, the use of petroleum derivatives as fuel for transportation will decline worldwide from 2026.

A call to oil investors

The International Energy Agency estimates that global investments in oil and gas exploration, extraction and production this year will reach $528 billion by 2023, the highest level since 2015, and are on track to keep the world adequately supplied through 2028. .

And while he did not properly reiterate his 2021 call for investors to stop funding new non-renewable energy projects, he did warn that current investment “exceeds the amount that would be needed in a world moving toward net zero emissions.”

In other words, Birol considered that oil producers must “pay close attention to the increasing pace of change” when “calibrating their investment decisions to ensure an orderly transition” in the sector.

With Reuters and EFE