Bengaluru — Global oil demand will likely be close to current levels in 2040, energy and commodities trader Vitol said in its long-term demand outlook on Monday, with rising consumption later this decade offset by a decline through the late 2030s.
The world’s largest independent oil trader expects oil demand – which the International Energy Agency puts at an expected 104 million barrels per day this year – to rise to nearly 110 million bpd by the end of the 2020s.
It then expects consumption to plateau until the middle of the next decade, before declining to around 105 million bpd by 2040.
Its outlook is below that of producer group OPEC, which in September last year pegged global demand at 117.8 million bpd by 2040.
Vitol said it expects the dominance of road transport fuels to decline, and for growth to be driven instead by plastics production and consumption of fuel in housing and aviation.
It sees global petroleum demand dropping by 4.5 million bpd by 2040, and oil demand from the petrochemicals industry likely rising by 6 million bpd, the report said.
Naphtha and LPG are expected to increase in importance, constituting a quarter of total oil demand by 2040 against a fifth today.
Vitol said population expansion, economic growth and urbanisation continue to spur demand for transport, plastics, chemicals and energy, sustaining oil demand despite efforts to mitigate climate change.
US tariffs on Mexican, Canadian and Chinese goods are set to kick in tomorrow.
It said there are no new disruptive technologies foreseen that it expects to impact oil demand by 2040.
“If, however, adoption of electric vehicles stalls, and targets were to be pushed back by just 5 years, road transport fuel demand could be 2-3 million bpd higher in 2040 than current projections,” it added.
In November last year, Vitol CEO Russell Hardy said he expected global oil prices to stay in a $70 to $80 per barrel range in 2025, similar to 2024, while geopolitical risks create uncertainty around supply.
* Anmol Choubey & Surbhi Misra; editing: Elaine Hardcastle, David Holmes & Jan Harvey – Reuters
