Climate effort won't quench crude oil thirst, demand to peak further
The Dollar Business Bureau
The latest set of measures taken by the nations to deal with climate change will fail to quench the global thirst of crude, while the global demand of oil will peak within 15 years, the global petroleum bloc has said.
Last week, several countries across the world signed a global pact with an aim to battle global warming. But the recent report released by the OPEC has underlined that it will take almost a century to bring down the consumption of oil due to the rising demand of fuel and a slow adaptation of alternative fuel cars, which will continue to affect climate change.
The OPEC reports look at how the energy market will perform over the next two decades of slashed estimates of coal and gas use owing to limited climate change, but left oil unscathed.
The report comes in the backdrop of collective efforts taken by various nations to cut planet-warming greenhouse gases.
The agreement last week was the first-ever deal comprising of all the nations, rich and poor, who laid out their commitments to cap global warming, generated mainly by the burning of coal, oil and gas.
The report cut down its estimate of coal demand to 91.5 million barrels of oil equivalent per day (mboe/d) in 2040, from 98.3 million barrel in last year's report, which still represents an increase from the 77.1 mboe/d of demand in 2014.
The estimated demand for gas in 2040 was cut to 101.7 mboe/d from 111.5 mboe/d. However, demand is still seen going up from the 59.6 mboe/d of demand in 2014, but, on the other hand, the estimate oil demand for 2040 was only trimmed to 99.8 mboe/d, from 100.6 mboe/d.
"A declining share for oil in the energy mix is mainly the result of tightening fuel efficiency standards across most countries of the world," said the report.
As the number of passenger cars is expected to double, and electric vehicles still accounting for a single digit percentage of vehicles, future demand for oil is slated to to increase significantly, with the growth in aviation and the petrochemical sectors, which will further oil demand.
The OPEC said the world needs $10 trillion of investments in order to meet future demand, as the overall energy demand is expected to climb to 382.1 mboe/d in 2040 from 273.9 mboe/d in 2014.