- Sep 28, 2022 5:47 pm GMT
How much does oil demand fall in a 1.5 °C scenario?
1-By two-thirds over the next three decades. Demand is just 35 million b/d by 2050 in the scenario, down from 99 million b/d in 2022 – that’s 60 million b/d below our current ETO (Energy Transition Outlook - Base case) forecast for 2050 of around 95 million b/d.
What Are The Main Drivers for the Oil demand decline ??
- Electrification of transportation is the main driver in the 1.5 °C scenario.
- The transport sector is already changing, with electric vehicles displacing gasoline-fuelled passenger cars.
- More electrification,
- Fuel cells,
- Natural gas/LNG
- Biofuels progressively eat into diesel and gasoil (heavy road transportation), fuel oil (shipping) and jet fuel (aviation); and non-transportation uses of oil in the industrial, commercial, agricultural and residential sectors.
- Naphtha, primary feedstock for the petrochemical sector, proves the only product that is most resilient oil product in the scenario buoyed by sustained demand for plastics.
How realistic is the 1.5 °C scenario?
The invasion of Ukraine has underlined how dependent the world is on oil, gas and coal.
- The consequence is that global carbon emissions won’t fall as rapidly as hoped
- decarbonisation also has a crucial role in meeting energy security goals. We are seeing a simultaneous acceleration of policy to get the world onto a 1.5 °C pathway.
- The signals are, that the aspiration to achieve net zero remains intact.
- If progress this decade is a little slower, the pace of change next decade may be much faster – including disruption to oil demand.
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