West energy agency at odds with Middle East producers
THE world’s two leading energy agencies are at odds over how much oil will be needed over the next two decades, in a split that threatens to wreak havoc for policymakers tackling climate change.
The International Energy Agency’s (IEA) new oil market report suggests global demand will peak around 2030, with the Paris- based organisation predicting growth will taper off as more clean energies come on stream.
However, the Organisation of Petrol eum Exporting Countries ( Opec), which represents Middle Eastern oil producers, predicts oil demand will rise for at least two more decades.
Opec forecasts demand will hit 116m barrels per day (bpd) by 2045, which is far higher than the IEA’S prediction that states’ oil consumption will reach an all-time high of 104m bpd this year.
The conflict will confuse climate scientists whose modelling of global greenhouse gas emissions depends on accurate forecasts.
The basis of the IEA’S optimism centres on predictions that economic growth in China and surrounding nations will slow, reducing energy demand. Fatih Birol, IEA director, told a ministerial meeting in Paris this week that he still believes the world’s energy systems are on the verge of a green transformation.
He said: “From 2025-2030 there will be a huge amount of renewable energy sources coming to market. Our numbers show that global oil demand will peak by 2030.”
Opec, however, predicts oil demand will rise much faster at 2.25m bpd for the rest of the decade. Its “World Oil Outlook to 2045” report says demand from global population growth will outpace declines caused by other factors.
Opec said: “Global population is expected to expand by around 1.5bn from nearly 8bn in 2022 to about 9.5bn by 2045. Global economic growth is expected to average 3pc per annum over the forecast period. Thus, global GDP is set to almost double from $138 trillion (£110 trillion) in 2022 to $270 trillion in 2045.”
The IEA was set up in 1974 under the auspices of the Organisation for Economic Co-operation and Development, representing Western democracies. It has since widened its membership to include nations such as China.