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Global Oil Demand will Peak in 2040

17 Jan 2019Email us

    The oil industry will need at least $10 trillion in new investments by 2040 to ensure that there is enough supply to meet the demands of global population growth, the current chairman of the Organization of Petroleum Exporting Countries (OPEC) said.

    In a speech in London on Tuesday, UAE oil minister bin Mohammedal-Mazroui called for people to invest in the oil industry because the oil market began to rebalance, after the oil market experienced years of oversupply. Mazrui is the rotating chairman of OPEC 2018.

“This year will be an interesting year. We expect the oil market to reach a balance of supply and demand this year, and most importantly, we will see some significant investments in this industry.” Mazruy at International Petroleum Week ( International Petroleum Week) said at the meeting.

    Funds should go into projects similar to make up for the decline in oilfield production, he said. He also stressed that OPEC is eager to get started, given the current timetable.

    “We are talking about things for the next 22 years (until 2040). We know that it can take about five years from the time a decision is made to the completion of the project. So I think that as OPEC, we should pay close attention to the dynamics of the oil market, And work together with each other," he said.

    Before the chairman of the oil production organization made this remark, BP also released its annual energy outlook. BP believes that the peak demand for oil will come earlier than previously expected, because renewable energy shoulders a larger share of the burden.

    According to The Wall Street Journal, global demand for oil and other liquid fuels will continue to grow until around 2035, when global demand will reach 110.3 million barrels per day, BP said in its outlook forecast released on Tuesday. By 2035, global demand for oil will remain stable, and global demand for oil will decline from then on until 2040. Previously, BP expects global demand for oil to continue to grow until 2040.

    In the annual global outlook released last November, OPEC said that global demand for oil will reach 111.1 million barrels per day in 2040, the main driving force is the massive population growth and the growth of the middle class in developing countries.

    Although the accelerated growth of US shale oil production poses a threat to OPEC's efforts to restore the oil market balance, OPEC has pledged to continue to cut oil production for the rest of 2018. The cartel and its 10 allies updated their production cuts in November last year, which caused crude oil prices to reach a high of $70 a barrel in January.

    Mazrui also said on Tuesday that OPEC and other non-OPEC oil producers may extend the production agreement to 2018.

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