WASHINGTON DC – The International Energy Agency estimates that global demand for oil is set to peak at the end of the decade before going into decline. The agency expects total demand will grow about 6% from 2022 to 2028, but that there are a number of things driving demand down.
One is that demand for oil for transportation is expected to decline as production of electric vehicles and cars with higher fuel efficiency lessens the need for gasoline. Another factor the agency notes is the war in Ukraine, which highlights the fragile nature of the supply chain for fossil fues and is driving more governments to invest in renewable energy sources.
“The shift to a clean energy economy is picking up pace, with a peak in global oil demand in sight before the end of this decade,” IEA executive director Fatih Birol said in a statement, adding that “oil producers need to pay careful attention to the gathering pace of change and calibrate their investment decisions to ensure an orderly transition.”
