Global oil demand could grow until 2050: Equnior

Global oil demand could peak within a decade if nations work together to hit climate goals, or keep growing into the 2050s in a conflict-ridden world, according to Norwegian energy firm Equinor.

The company, formerly known as Statoil, made the double-edged prediction in its new energy outlook, stating that expectations of when peak oil will be reached is likely to change supply dynamics as investors consider whether to back long-term oil projects.

“An oil market in potential decline increases the uncertainty the producers face, reduces their investment horizon, and increases the focus on short payback periods for investments,” said the business.

Equinor changed its name to reflect its strategy to gradually move away from oil production and become a ‘broader’ energy company. It plans to increase investments in renewable energy to between 15% and 20% of its total capital expenditure by 2030.

Three scenarios are included in the report – Renewal, Reform and Rivalry – with oil demand varying between 59 million and 122 million barrels per day (bpd) in 2050, compared with 97.8 million bpd in 2017.

The Renewal scenario is consistent with the goal of the Paris climate agreement to limit a rise in the world’s average surface temperatures to below 2 degrees Celsius above pre-industrial times, while the Reform scenario is based on a continuation of existing policy and technology trends.

The geopolitical backdrop within the Rivalry scenario is ‘a fluid, volatile and conflict-ridden world’, where a lack of trust prevents countries from addressing climate change effectively.