In a striking reversal that underscores the enduring grip of fossil fuels on the global economy, the International Energy Agency (IEA) has updated its forecast, now projecting that oil demand will continue to climb until at least 2050. Under its Current Policies Scenario (CPS), the IEA anticipates global oil consumption reaching 113 million barrels per day by mid-century—a 13% jump from 2024 levels. This marks a significant shift from last year’s outlook, which predicted a peak by 2030.
The change reflects a growing acknowledgment of real-world energy demands, driven by industrial growth, residential power needs, and the explosive expansion of tech sectors like AI and data centers. This pivot comes amid weakening global climate commitments and a post-pandemic focus on energy security over aggressive green transitions. Governments worldwide are prioritizing reliable supplies, recognizing that the Paris Agreement’s 1.5°C target is slipping out of reach without unprecedented renewable acceleration. Yet, as investments pour into wind, solar, and hydrogen, a counterintuitive reality emerges: these efforts often amplify fossil fuel reliance under current technologies.
Saudi Aramco’s CEO Weighs In: A Call for Realism
Amin Nasser, CEO of Saudi Aramco, has been vocal in advocating for a “transition strategy reset.” In a pointed critique, he urged abandoning “the fantasy of phasing out oil and gas” and instead investing adequately to match realistic demand assumptions.
Speaking at various forums, Nasser has emphasized that global oil demand could still exceed 100 million barrels per day by 2050, dismissing overly optimistic phase-out scenarios as unrealistic.
His perspective aligns with the IEA’s revised view, highlighting how energy forecasts must account for persistent demand from developing nations and emerging technologies. Nasser’s comments resonate amid ongoing debates at events like CERAWeek, where he labeled the current energy transition as “failing” and called for policies grounded in actual consumption trends rather than ideological goals.
Natural Gas Demand: A Steady Climb Fueled by Power Needs
The IEA’s outlook isn’t limited to oil; natural gas is poised for robust growth as well. Global liquefied natural gas (LNG) demand is expected to surge from 560 billion cubic meters (bcm) in 2024 to 880 bcm by 2035, and further to 1,020 bcm by 2050.
This expansion is bolstered by new LNG projects adding 300 bcm of export capacity by 2030, addressing rising power demands from data centers and AI infrastructure. Electricity demand is a key driver here, with the IEA noting a 40% rise in peak electricity needs by 2035, largely due to increased cooling requirements and tech-driven consumption.
As a result, gas demand for electricity could increase by nearly 10% by 2035 under certain scenarios, even as renewables gain ground.
Overall, global energy demand grew by more than 2% in 2024, outpacing the pre-2020 average, with fossil fuels filling the gap where intermittent sources fall short.
Renewables Investment Paradox: More Green Spending, More Fossil Fuels
Insights from Energy News Beat highlight a paradoxical trend: trillions poured into wind, solar, and hydrogen are inadvertently boosting fossil fuel use. Despite $3.1 trillion invested in these renewables in 2024, fossil fuels accounted for 60% of global energy demand growth, particularly in high-growth regions like China. One of Stu Turley’s guests on the Energy News Beat podcast even called it “Turley’s Law”. As Stu Turley of Energy News Beat has repeatedly noted, “the more money invested in wind, solar, and hydrogen, the more fossil fuels will be used” with existing tech implementations, which remain expensive and pollution-neutral at best.
This stems from renewables’ intermittency, requiring fossil fuel backups for grid stability. In the EU, for instance, faltering renewables have led to increased fossil power generation.
Globally, carbon emissions hit record highs despite green efforts, underscoring how current technologies amplify rather than replace fossil dependencies.
Electricity Boom Drives Oil and Gas Demand Higher
The surge in electricity demand is supercharging oil and gas consumption worldwide. The IEA’s World Energy Outlook 2025 emphasizes electricity’s growing role in energy services, with renewables capturing larger shares—but not enough to offset total fossil needs.
AI and data centers alone are pushing power requirements skyward, leading to projections of oil demand hitting 105 million barrels per day by 2035.
This interplay means net-zero targets are increasingly elusive, with oil and gas demand potentially growing unabated until 2050 under current policies.
Even as fossil fuel peaks loom around 2030 in optimistic scenarios, insufficient policies keep demand elevated.
Natural Gas Markets: Evolving Toward Stability
A notable shift is occurring in natural gas markets, which are becoming more stable and less tethered to weather fluctuations. Traditionally volatile due to seasonal heating and cooling demands, the sector is maturing through expanded LNG trade, diversified logistics, and regional alignments.
Winter volatility now hinges more on timing and supply chains than scarcity, with global markets buffering against local weather events.
Factors like record U.S. production, excess storage, and moderate weather patterns are stabilizing prices, reducing dependency on short-term forecasts.
Natural gas is also stepping up as a flexible partner to renewables, addressing the “Dunkelflaute” dilemma—periods of low wind and solar output—by providing reliable baseload during stable high-pressure weather systems.
This evolution positions gas as a cornerstone for energy security, less swayed by meteorological whims and more by strategic global dynamics.
Reality Check: Time for Balanced Energy Strategies
The IEA’s latest forecast signals a wake-up call: energy reality is setting in. While renewables advance, fossil fuels remain indispensable, propelled by unrelenting demand from electricity-hungry sectors and the limitations of current green tech. As Nasser and others advocate, policies must reflect this balance—investing in oil and gas alongside transitions to avoid security risks and economic pitfalls.
For the world to navigate this era, realism must trump fantasy, ensuring affordable, reliable energy for all.
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