IEA expects ‘unprecedented’ surplus of oil by 2030

The International Energy Agency (IEA) expects an ‘unprecedented’ oil surplus of 8 million barrels daily by 2030. According to the Agency’s latest report, oil demand worldwide will slow down, driven by the energy transition.

Several aspects, including the increasing number of electric cars, better fuel efficiency in cars with combustion engines, and decreasing use of oil for power production in the Middle East, will compensate for petrochemicals.

Peak by the decade’s end

IEA CEO Fatih Birol predicts that oil demand will peak by the end of this decade. Global oil demand will cap at around 106 million barrels per day by the decade’s end. In 2023, global demand was 102 million barrels.

At the same time, the IEA sees an increase in oil production, led by the United States. As a result, supply will exceed demand and reach 114 million barrels by 2030. This would lead to surplus levels never seen before except at the height of the coronavirus lockdowns in 2020.

However, oil demand will increase in the coming years, partly due to the expected growth of major Asian economies such as India and China. In addition, people will take the plane more often, which requires kerosene. The petrochemical industry, which requires oil as a raw material, is also still growing.

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