The gap between the oil demand required for net-zero and the demand currently forecast is massive, according to BP’s latest annual outlook. The energy giant estimates oil use must plummet to 35 million barrels per day (b/d) by 2050 to meet climate goals, yet its current projection is 83 million b/d, confirming the world is likely to miss the 2050 net-zero target.
BP’s revised figures reflect a global slowdown in the clean energy transition. The long-term forecast for oil consumption in 2050 has been raised by 8%, now expected to hit 83 million b/d, up from the prior 77 million b/d estimate. Natural gas demand is also forecast to remain resilient, projected at 4,806 billion cubic meters annually in 2050. Furthermore, BP has delayed the expected date of peak oil demand by five years, now projecting 103 million b/d in 2030.
This sustained high demand is being fueled by geopolitical instability. BP highlights that conflicts in the Middle East and Ukraine, coupled with rising trade tariffs, are intensifying the focus on national energy security. While this security push might accelerate some countries towards ‘electrostates’ powered by domestic low-carbon energy, the report strongly warns of the counter-risk: an increased preference for domestically produced fossil fuels over imported alternatives.
The report underscores the severe consequences of this slow transition. BP calculates that the world is currently on a path that will breach the cumulative 2∘C carbon budget limit by the early 2040s. The company cautions that the longer the delay in fundamental decarbonization, the higher the economic and social cost will be for future mitigation efforts. The contrast between the necessary 35 million b/d and the projected 83 million b/d for 2050 illustrates the failure of current policy to drive the required decline.
Despite the rapid expansion of renewables—set to meet over 80% of new electricity demand by 2035—oil will remain the largest single source of primary global energy supply, holding a 30% share in 2035. Renewables, while rising from 10% to 15% of the primary energy mix by 2035, are not expected to surpass oil’s market share until the late 2040s, emphasizing the deep inertia in the global energy system.