Global oil demand is set to peak in 2032, two years later than previously expected, due to solid petrochemical demand and sluggish U.S. and European electric vehicle sales, Wood Mackenzie said in its new Energy Transition Outlook 2025-2026 report on Wednesday.
“Oil demand peak has shifted from 2030 to 2032, reflecting sluggish EV sales in the US and Europe, and continued momentum in petrochemicals,” WoodMac said.
The surge in AI and power demand will support natural gas across all four different pathways for the energy and natural resources sector that WoodMac has analyzed.
Energy demand will keep rising to 2050, as population growth, increasing incomes, and industrialization drive consumption.
The global electricity market is set to expand by a fifth by 2030 and double by 2050. However, clean energy will address supply rather than phasing out fossil fuels, according to Wood Mackenzie.
“The share of solar and wind in global power supply has grown from 5% to 20% over the past decade and the surge is expected to continue,” said Prakash Sharma, vice president, head of scenarios and technologies for Wood Mackenzie.
“But accelerating from deployment to a deeply decarbonized, resilient energy system is proving far more complex than simply adding megawatts.”
Last month, BP said that global oil demand is set to rise through 2030 amid weaker-than-expected efficiency gains. BP’s 2025 Energy Outlook ditches the supermajor’s forecast from last year that oil demand could peak as soon as this year.
Currently, the mid-2030s seems to be the most prevalent choice of international majors and energy forecasters for peak oil demand.
The exceptions, in the two extremes, are the International Energy Agency (IEA) which sees demand peaking by the end of this decade, and OPEC, expecting oil demand to continue rising through 2050, with consumption seen at 123 million barrels per day (bpd) then, up from about 104 million bpd this year.
By Michael Kern for Oilprice.com
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