• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 4 days Does Toyota Know Something That We Don’t?
  • 4 days World could get rid of Putin and Russia but nobody is bold enough
  • 2 hours America should go after China but it should be done in a wise way.
  • 7 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 6 days China is using Chinese Names of Cities on their Border with Russia.
  • 7 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 7 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 6 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 7 days Putin and Xi Bet on the Global South
  • 7 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 8 days United States LNG Exports Reach Third Place
  • 8 days Biden's $2 trillion Plan for Insfrastructure and Jobs
BofA: Oil Demand Growth Has Peaked

BofA: Oil Demand Growth Has Peaked

Global oil demand continues to…

Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

More Info

Premium Content

Forecasters Have No Clue Where Oil Demand Is Really Going

  • The giant gap between high and low case energy scenarios creates enormous uncertainties for investors and companies.
  • The demand "gap" between OPEC's High GDP Growth Case and the IEA's Net Zero Emissions Scenario rises to 84.6 million bpd in 2045.

Since the Paris Agreement in 2015, the oil market and investors have seen a growing gap between the highest and lowest demand scenarios from the major forecasting agencies to the point that the gap has widened to a size that is larger than today's oil market, or 100 million barrels per day (bpd), the Riyadh-based International Energy Forum (IEF) said on Wednesday.

IEF and Resources for the Future (RFF) published today their 'IEF RFF Outlooks Comparison Report', which compares energy market outlooks prepared by the International Energy Agency (IEA) and OPEC using various modelling techniques and in consultations with those two organizations.

The demand "gap" between OPEC's High GDP Growth Case and the IEA's Net Zero Emissions Scenario rises to 84.6 million bpd in 2045, the IEF RFF report notes.

The IEA's net-zero scenario says that investments in new oil and gas resources must stop after 2021 if the world is to achieve net-zero emissions by 2050.

In the most extreme scenarios—the highest scenario of the U.S. Energy Information Agency (EIA Reference) and the lowest scenario from IRENA (IRENA 1.5°C), this difference in oil demand estimates surges to 105 million bpd, which is larger than the size of the entire global oil market today, the IEF RFF scenario comparison report found.

"With each year, outlooks diverge more sharply from current market realities, under pressure to project alignment with both climate and energy access targets against a backdrop of increasing prices and volatility in global energy markets," said Joseph McMonigle, Secretary General of the IEF, commenting on the report.

"This giant gap between high and low case energy scenarios creates enormous uncertainties for investors and companies that must make capital allocation decisions as well as policymakers that develop energy roadmaps," McMonigle added.

In addition, the reports and scenarios IEF RFF compared contain enormous uncertainties over the role of policy and technological advancement and development in potentially replacing part of the oil and fossil fuel-derived energy we use today, the report showed.

"Increasingly diverse outlook findings enrich the energy dialogue but also warrant greater scrutiny and alignment of methods, categories, baseline data, and time frames to improve comparability and deepen understanding," the report reads.   

By Tsvetana Paraskova for Oilprice.com


More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment
  • Mamdouh Salameh on February 16 2022 said:
    The global oil demand gap between OPEC's High GDP Growth Case and the IEA's Net Zero Emissions Scenarios is the result of contrasting assumption.

    For instance, the IEA’s net zero emissions scenario assumes a peak oil demand by the 2030’s if not earlier, net zero emissions by 2050, renewables particularly solar and wind power providing the bulk of electricity generation by 2050 and EVs replacing the bulk of ICEs.

    On the other hand, OPEC’s high GDP growth scenario is based on the assumptions of continued global oil demand albeit at slightly decelerating rates well into the future underpinned by a rising world population and a growing global economy, inability of renewables to supply the bulk of global electricity because of their intermittent nature and no post-oil era well into the future or until an alternative as versatile and practicable as oil is found or developed.

    The IEA’s assumptions are unrealistic whilst OPEC’s scenario is based on the reality that oil will continue to drive the global economy well into the future, hence the giant demand gap between the two scenarios ranging from 85-100 million barrels a day (mbd).

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News