Global Oil Demand to Hit a Plateau Around 2030

Global oil demand will hit a plateau around 2030 as the use of more efficient cars and electric vehicles ends an expansion that dominated the past century, the International Energy Agency predicts.

While the current growth rate of 1 million barrels a day -- or about 1% -- will hold for the next five years, it will ebb to just 100,000 barrels a day in the 2030s, the agency said, Bloomberg reported.

By that time, the use of oil-based fuels in passenger cars will have peaked, the IEA said in its long-term World Energy Outlook.

The IEA anticipates a marked slowdown in consumption growth after 2025.

“Oil demand plateaus post-2030,” said Fatih Birol, executive director of the Paris-based agency, which advises most major economies.

“Demand growth is robust to 2025, but growth slows to a crawl thereafter.”

The prospect of “peak demand” has spread in the oil industry in recent years as countries seek to avert catastrophic climate change by diversifying from fossil fuels, and as renewable-energy sources get cheaper.

While the IEA sees “no definitive peak,” the stagnation it envisages will have far-reaching consequences.

The warning comes at a particularly delicate moment for Saudi Arabia, the world’s biggest oil exporter, which is selling a stake in its state-run oil company as part of its preparations for a lower-carbon world.

The kingdom acknowledged the risk of peak demand in the prospectus for the initial public offering.