Thursday, 22 October 2020 12:07

IEA: Natural gas demand increase will come from developing countries

According to the forecast of the International Energy Agency (IEA), oil demand will plateau in the 2030s, as transport fuel will no longer be a reliable driver of growth. Greater efforts to improve the efficiency of electrification and recycling will be needed to reduce demand growth.

 

The era of rising oil consumption will end within a decade, the report says.

 

Alternative energy, especially solar and wind, will provide 80% of the increase in electricity consumption over the next 10 years.

 

Oil demand will plateau in 2030, after which annual oil consumption will not exceed 100 million b/d, as in 2019. The peak will come at the level of 103.2 million b/d in the basic scenario, in the pessimistic scenario, it will not be higher than the level of 2019.

 

All growth will be provided by developing countries — like OPEC, the IEA predicts the end of the oil era for developed countries.Thanks to developing countries, natural gas consumption will increase.

 

In 2020, global oil consumption will decrease by 8% (8 million b/d less than in 2019), coal — by 7%.Demand for coal will not return to pre-crisis levels by 2040.

 

It will account for less than 20% of the energy consumed — for the first time since the industrial revolution.

 

In the main scenario, oil demand returns to 2019 levels in 2023, and in the deferred recovery scenario, only in 2027.

 

The oil industry is going to face chronic underinvestment. The US will remain the world leader in production until 2040 thanks to shale oil, the Agency predicts.

 

According to the OPEC forecast published earlier, the peak demand for oil will come later — in the late 2030s - and will be higher, while the after-coronavirus demand will recover by 2022.

 

Before the crisis, demand for energy resources was expected to grow by 12% from 2019 to 2030, the Financial Times writes.

 

Now we are talking about growth of 9% in the IEA baseline scenario and 4% — assuming the worst growth since the 1930s. Coal will face the most strongest impact, the newspaper emphasizes. Oil and natural gas will gradually return to growth, but the recovery for oil will last until 2027, after which the global level of consumption will approximately equal that of 2019.

 

The IEA notes that the pandemic affects oil consumption in two ways: on the one hand, it is negatively affected by restrictions on flights and switching to remote work, but on the other hand, people are trying to use public transport less often and prefer private cars.

 

                                                       

 

 

 

 

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