Global Oil Demand to Peak Before the End of the Decade

In its latest medium-term market report, the International Energy Agency (IEA) has predicted that global oil demand will trickle nearly to a halt by 2028.
The agency forecasts that global oil demand will rise by 6% from 2022 to reach 105.7 million barrels per day in 2028. This growth will primarily be driven by the petrochemical and aviation sectors.

Under prevailing policy conditions, global oil demand growth is expected to trickle nearly to a halt in the coming years and peak later this decade. 

The shift to a clean energy economy is building speed, with a final peak in global oil demand expected to arrive as early as the end of this decade as electric vehicles and other green technologies advance.

From today’s 105.7 million barrels a day, the IEA predicts that annual demand growth will thin down to just 400,000 barrels per day in 2028.

The IEA is alerting market players over ongoing upstream oil and gas investment, which it predicts will reach its highest since 2015 at $528 billion in 2023. However, oil producers would need to pay careful attention to the gathering pace of change and calibrate their investment decisions in the face of the inevitable green transition.

Several analysts contend that the global energy crisis that followed the onset of the COVID-19 pandemic and Russia’s invasion of Ukraine had accelerated the transition away from fossil fuels. This, coupled with the fierce update of electric vehicles and technologies in developed nations mean there is a significant energy mix transformation on the cards.