The high demand for oil continues until 2045

OPEC remains confident that demand for oil will continue to rise, as its report on the global oil outlook for 2021 revealed that global demand for crude will continue to rise until 2045, and that most of this increase will be recorded in the current decade.Join Our Telegram group to know the latest news in Kuwait https://t.me/kuwaitoffering

OPEC expected an increase in demand by 17.6 million barrels per day until 2045, to reach 108.2 million barrels per day by that time.

The OPEC report expected that the demand for energy will grow by 28% from 2020 to 2045, driven by the doubling of the value of the global economy, and the increase in the population around the world by 1.7 billion people by 2045 to reach 9.5 billion people.

He noted that oil consumption will rise by 1.7 million barrels per day in 2023 to 101.6 million barrels per day, adding to the already strong growth expected for 2021 and 2022.

The organization believes that the rise will be noticeable in developing countries, while it will decrease from 2023 in the rich countries of the Organization for Economic Cooperation and Development.

OPEC appears optimistic about its future prospects, seeing that its market share will rise in later decades as competition from non-OPEC producers diminishes, and it expects US shale oil production to peak around 2030.

Although the report acknowledged that renewable energy is the fastest growing among energy sources, it expected that it would constitute only 10% of the world’s needs by 2045. In addition, the price of a barrel of Brent crude jumped yesterday above $ 80, an unprecedented rise in nearly 3 years, which was boosted by Investors expect high demand and market fears for supplies, as the world slowly emerges from the “Corona” crisis. 

Here are the full details

The Organization of the Petroleum Exporting Countries is still confident of the continued rise in demand for oil, as it said in its World Oil Outlook Report for the year 2021, that global demand for oil will continue to rise until 2045, and that most of this increase will be recorded in the current decade.

She noted that oil consumption will rise by 1.7 million barrels per day in 2023 to 101.6 million barrels per day, which adds to the already strong growth expected for 2021 and 2022, and raises the level of demand again above the pre-pandemic rate in 2019.

OPEC expected demand to increase by 17.6 million barrels per day between 2020 and 2045, to reach 108.2 million barrels per day by that time. This rise is slightly less than what the organization expected last year. Taking 2019 as a reference, that is, before the crisis and the collapse in demand recorded last year, the rise appears less significant, with about 8.2 million barrels per day by 2045.

It expected that the demand for energy will grow by 28% from 2020 to 2045 amid a noticeable demand for all forms of energy, driven by the doubling of the value of the global economy, and the increase in the population around the world by 1.7 billion people by 2045 to reach 9.5 billion people.

demand recovery

“Demand for energy and oil has rebounded significantly in 2021, after the significant decline recorded in 2020, and the spread is expected to continue in the long term,” said OECD Secretary-General Muhammad Barkindo, in his introduction to this report.

The organization believes that the rise will be noticeable in developing countries, while it will decrease from 2023 in the rich countries of the Organization for Economic Cooperation and Development.

With oil demand recovering, OPEC and its allies such as Russia, within the framework of the OPEC + group, are working to cancel the unprecedented oil production cuts it adopted last year. However, there are indications that some OPEC+ producers are unable to increase production, partly due to a lack of investment in the sector, which has led to higher prices.

Oil demand

OPEC also lowered its estimates of long-term oil demand in the report, attributing this to changes in consumer behavior due to the pandemic and competition from electric cars. It added that global demand is expected to stabilize after 2035.

Last year’s report said that global oil demand would exceed the 2019 level in 2022, not 2023. Now, global oil demand is expected to reach 106.6 million barrels per day in 2030, down 600,000 barrels per day from the figure in last year’s report.

The OPEC chart, which shows a clear drop in demand compared to a similar chart last year, suggests that assuming faster adoption of current technology, called the faster technology and policy scenario, demand could decline by 2030.

Increase supplies

OPEC has said that demand for its oil will rise in the next few years, but increased supplies from the United States and other producers from outside it mean that OPEC production in 2026 will likely be 34.1 million barrels per day, which is below the level of 2019.

Last year, the group turned to acknowledging that demand would one day peak after projecting growth for years. The forecast for demand in 2045 this year has shrunk to 108.2 million barrels per day, down 900,000 barrels per day from last year’s forecast. Non-OPEC producers expect US shale oil production to peak around 2030.

 Brent jumps above $80 

Yesterday, the price of a barrel of Brent crude jumped above $ 80, an unprecedented rise in nearly three years, boosted by investors’ expectations of rising demand, and market concerns over supplies, with the world slowly emerging from the Corona crisis.

With the availability of vaccines against Corona, which contributed to easing the closure measures in several countries, expectations have emerged that the demand for oil will increase.

$11.8 trillion cumulative investment

The organization indicated that the cumulative investments required for the oil sector will reach about 11.8 trillion dollars in the period from 2021-2045, with 80% of them (9.2 trillion dollars) going to the exploration and production sector, especially in North America, where American oil leads the supply growth for non-member countries of the Organization OPEC in the medium term.

Renewables will constitute 10% of the world’s needs

Although the report acknowledged that renewable energy is the fastest growing among energy sources, it is expected that it will constitute only 10% of the world’s needs by 2045.

Huge investment

Barkindo stressed that “huge investments” will be necessary to meet demand, saying that “without the necessary investments, a new series of fluctuations and energy shortages may occur in the future, and this is not in the interest of producers or consumers.”

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