Baku, Azerbaijan, Dec.7
By Leman Zeynalova – Trend:
The global oil demand will peal over the next twenty years, according to the UK-based Capital Economics consulting company.
“Slower global economic growth and rapidly rising fuel efficiency mean that growth in demand for oil will slow and demand will eventually peak over the next twenty years,” Trend reports citing the company’s outlook.
At the same time, plentiful oil reserves mean that supply should be ample and as a result, Capital Economics expects real oil prices to trend down over the next two decades.
“Global oil consumption has been rising by an annual average of around 1.4 percent since 2000. But we expect a considerably slower pace of growth over the coming decades. Advances in engine technology and lighter materials mean that fuel efficiency in all forms of transport should improve,” said a report from the company.
In addition, the consulting company expects rapid growth (admittedly from a low base) in electric, and other types of alternatively-fuelled, vehicles. “This should more than offset the expected growth in transport demand in emerging markets in 2020-40.”
Declining global economic growth will also weigh on oil demand, the analysts of Capital Economics believe.
“This is particularly the case as future economic growth is likely to be driven more by services and technology, which will not necessarily result in a proportionate increase in oil demand. The upshot is that we expect global oil demand to peak at just under 115 million barrels per day in 2035, up from around 100 million barrels per day today, before starting to fall,” said the report.
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