OPEC has revised its long-term oil demand outlook upwards by 1.7 million barrels a day as oil is set to dominate the energy mix in the future.
In its 2017 World Oil Outlook OPEC says that total primary energy demand is set to increase by 35% in the period to 2040 and that oil is expected to remain the fuel with the largest share in the energy mix through to 2040.
The document sets out that long-term oil demand has increased by 1.7 million barrels a day compared to its 2016 counterpart, with total demand sitting at over 111 million barrels a day by 2040. This is despite the talk of relying more on alternative forms of energy, from renewable fuels to the growing trend of electric vehicles.
In fact, long-term oil demand will come mainly from road transportation, making up 5.4 million barrels per day, followed by petrochemicals and then the aviation sector. However, OPEC does recognise various international efforts to increase the use of electric vehicles into consumer behaviours. It says that in the passenger car segment, electric vehicles will represent 12% of the car fleet by 2040.
Additionally, the international organisation does not expect to hit peak oil demand over the forecast period to 2040. And around half of the estimated refining capacity additions will be focused in the booming Asia-Pacific region, which is projected to add 9.5 million barrels per day by 2040.
OPEC Secretary General His Excellency Mohammad Sanusi Barkindo, says: ‘The past year has been an historic one for OPEC and the global oil industry. Since publication of the World Oil Outlook in 2016, the oil market has undergone a fundamental change. It has been a period where the rebalancing of the global oil market has gathered vital momentum, buoyed by a number of important factors.
‘We need to remember that the short, medium and long-terms are all intertwined, which is underscored in the World Oil Outlook 2017.’