Global oil and gas demand is expected to continue growing until 2050, according to the International Energy Agency (IEA). This forecast represents a shift from previous expectations of a rapid transition to cleaner energy sources, influenced by criticisms from the United States regarding the IEA’s focus on climate issues.
The IEA’s annual outlook also projects that the world is unlikely to achieve its goal of limiting the rise in temperatures to 1.5 degrees Celsius above pre-industrial levels to mitigate the severe impacts of climate change. Pressure from the U.S., particularly during the Trump administration, pushed the IEA to emphasize clean energy policies. However, the current outlook predicts a peak in global oil demand this decade and calls for a halt in new investments in oil, gas, and coal projects to achieve net zero emissions by 2050.
The IEA’s latest scenario, based on existing government policies rather than climate goals, forecasts a significant increase in oil demand to 113 million barrels per day by mid-century, up approximately 13% from 2024 levels. The report also anticipates a 15% rise in global energy demand by 2035. This scenario contrasts with the IEA’s previous focus on clean energy transition and reflects diverse energy policy choices made by governments.
In response to criticisms, the IEA notes that its scenarios explore various outcomes based on different assumptions and are not definitive forecasts. While renewable energy and energy efficiency have made remarkable progress worldwide, the growth is still insufficient to outpace fossil fuel consumption, according to experts. Some analysts believe the IEA underestimates the rapid growth of renewable energy, especially in developing nations, driven by declining prices and technological advancements.
The IEA report highlights a surge in final investment decisions for new liquefied natural gas (LNG) projects, with a projected 50% increase in global LNG supply by 2030. The rise in LNG capacity is driven by escalating demand in the power sector, fueled by the growth of data centers and artificial intelligence. Additionally, global investments in data centers are expected to surpass spending on oil supply, indicating a shifting landscape in energy consumption patterns.
Despite global efforts to limit temperature rise, the report indicates that the world is on track to exceed the target of 1.5 degrees Celsius warming. The IEA emphasizes that achieving climate goals requires a rapid phase-out of fossil fuels alongside the growth of renewable energy sources.