Longterm oil demand has been revised upward from 95.4 million barrels a day (mb/d) to 111.1 mb/d by 2040. Out of which developing countries will fueled the demand from 43.2 mb/d in 2016 to 67.0 ml/d in 2040, stated the recent report release by The Organization of the PetroleumExporting Countries (OPEC).
The recent data has been released in the OPEC’s World Oil Outlook event held in Vienna on Wednesday.
The event was focusing on security and risk in future and present oil industry. It weaned about fragile growth of oil industry in near future. “we need to remember that the short-, medium- and longterms are all intertwined”, explained Mohammad Sanusi Barkindo, OPEC Secretary General in the report.
The demand will rise because of varies sector like road transportation, petrochemicals and aviation. Notably, developing countries will accelerate demand growth by almost 24 mb/d, which will reach to 67 mb/d by 2040.
Moreover, around half of the estimated refining capacity additions are expected in the Asia-Pacific, which is projected to add 9.5 mb/d by 2040, state the report. Implying the fact that with 43.2 mb/d in 2016 to 67.0 mb/d in the year 2017, developing countries which mainly includes Latin America, Middle East & Africa, India and China, will be the major consumers.
There are varies factor due to which developing countries have topped the chart. Primarily due to expanded middle class, high population growth rate and expanding economic growth. On the other hand, there will be a significant decrease in the demand of oil in developed countries. Mainly because expected decrease in population rate, tightening energy policy targeting energy efficiency by diverting towards increase usage of Renewable energy sources and finally, due to significant penetration of alternative fuel vehicles.
Whereas, if the Average annual oil growth is considered, developing countries mainly China and India will witness a significant decrease. The oil demand growth is forecast-ed to decline from 1.3mb/d to 0.3 mb/d. The soaring shift is mainly because three factors.
Firstly, the economy which profound to be shifting from more oil intensive heavy industry towards service-oriented industry. One of the example for this is China. Again, Energy efficiency tightening policies and technological improvement will add on to the shift. And finally because of alternative fuel switch, primarily to EVs and LNG.
Overall, the required global oil sector investment estimated at $10.5 trillion, by the year 2040 and the world will witness around 35% hike in its total primary energy demand.
Importantly, oil will serve as largest share in the energy mix throughout the year 2040.
(Image Source: OPEC)
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