IEA says world oil and gas demand could increase by 2050

Global energy demand is forecast to rise by 15 percent by 2035 compared to current levels. The projection takes into account existing government policies and not efforts to meet climate targets. The IEA last used the “business as usual” scenario for its projections in 2019, before switching from 2020 to projections more in line with the clean energy transition and pledges to achieve net zero emissions by mid-century. This year’s forecast no longer includes the scenario of promises.

According to the IEA, the engines of growth will be emerging economies, India, Southeast Asia, the Middle East, Africa and Latin America, which will take over the dynamics from China, which has accounted for half of the growth in global oil and gas demand and 60 percent of the expansion in electricity demand since 2010.

The increase in energy consumption in emerging regions will lead to economic development and the expansion of energy-intensive industrial and service sectors.

According to the report, The oil market is expected to be oversupplied in the short term, as reflected in the current prices of $60-65 despite geopolitical tensions.

Global oil demand growth is slowing, but remains significant due to transport and industry; emerging economies are taking over most of the expansion from China.

However, demand growth is moderating: the WEO report points out that oil demand growth could slow down, especially if the transition and the spread of alternative energies accelerate.

Under the current policy scenario, the global LNG market is expected to grow from around 560 billion cubic meters in 2024 to 880 billion cubic meters by 2035 and 1,020 billion cubic meters by 2050, driven by rising energy demand driven by the growth of data centers and artificial intelligence.

On the supply side, new LNG export capacity and expanding refining capacities will appear and exert price pressure on oil and gas markets: by 2030, about 300 billion cubic meters of new LNG export capacity will come into operation, which represents a 50 percent increase in global supply. Half of this will be built in the United States and 20 percent in Qatar.

The report highlights that although oil and gas supply currently appears relatively stable, geopolitical risks remain. Natural gas demand has been revised upwards in the WEO, mainly due to industrial and power generation needs; The expansion is mainly concentrated in emerging regions.

According to the report, the role of electricity in energy demand in particular is increasing, with electricity consumption growing faster than total energy use. Investments are already largely focused on electricity supply and electricity end-use – for example, in expanding grids, storage and power generation capacity. The increase in electricity demand is largely due to the expansion of data centers and AI use; In 2025, $580 billion is expected to be invested in data centers, exceeding the $540 billion invested in oil supplies.

The geographical concentration of refining/processing of critical minerals essential for power grids, batteries and electric vehicles remains high, with one country dominating around 70 percent of the refining of around twenty key minerals, a trend that has continued to grow since 2020 (particularly for nickel and cobalt). These minerals are also crucial for AI chips, jet engines, defence systems and other strategic industries. Diversification is slow, with announced projects likely to create supply shortages and increase geopolitical dependencies.