New Delhi: Global oil demand is projected to rise by 2.5 million barrels per day (mb/d) between 2024 and 2030, reaching a plateau of around 105.5 mb/d by the end of the decade, according to the International Energy Agency’s (IEA) latest medium-term outlook released on Tuesday.
The report, Oil 2025, states that while demand growth continues, structural changes in global supply and consumption patterns are expected to reshape the oil market over the coming years. Production capacity is forecast to rise by more than 5 mb/d to 114.7 mb/d by 2030, led by growth in natural gas liquids (NGLs) and other non-crude liquids.
Electric vehicles are projected to displace 5.4 mb/d of oil demand globally by 2030. Electric car sales reached a record 17 million in 2024 and are expected to surpass 20 million in 2025, the report noted.
“Based on the fundamentals, oil markets look set to be well-supplied in the years ahead – but recent events sharply highlight the significant geopolitical risks to oil supply security,” IEA Executive Director Fatih Birol said. “The IEA remains deeply committed to working with energy producers and consumers to safeguard energy security.”
China, which has been the largest driver of global oil demand for over a decade, is expected to see its consumption peak in 2027 due to increased electric vehicle adoption, high-speed rail expansion, and natural gas-powered trucks.
On the supply side, while the US remains the largest contributor to non-OPEC output, its production growth is expected to slow as companies focus on capital discipline. Still, output from the US, Canada, Brazil, Guyana, and Argentina is expected to be sufficient to meet demand growth through 2030.
The OPEC+ alliance has started to unwind production cuts, but in the absence of major supply disruptions, oil markets are expected to remain comfortably supplied.
The report also indicates that demand for combustible fossil fuels—excluding petrochemical feedstocks and biofuels—could peak as early as 2027. Meanwhile, the petrochemical industry is expected to become the dominant driver of oil demand growth from 2026, consuming one in every six barrels of oil by 2030.
The shift toward non-crude liquids is also expected to impact refining. With net refinery capacity projected to exceed demand for refined products by 2030, more shutdowns in refining capacity are likely.
The replacement of oil with natural gas and renewables in power generation, particularly in the Middle East and especially Saudi Arabia, is expected to further weigh on oil demand.
The IEA report provides a longer-term perspective compared to its monthly Oil Market Report, offering forecasts and trends in oil demand, supply, refining, and trade up to 2030.
