LONDON, Oct 16 (Reuters) - The world is on the brink of a new age of electricity with fossil fuel demand set to peak by the end of the decade, meaning surplus oil and gas supplies could drive investment into green energy, the International Energy Agency said on Wednesday.
But in a release accompanying its annual World Energy Outlook report, the agency also flagged a high level of uncertainty as conflicts embroil the oil and gas-producing Middle East and Russia and as countries representing half of global energy demand have elections in 2024.
“In the second half of this decade, the prospect of more ample – or even surplus – supplies of oil and natural gas, depending on how geopolitical tensions evolve, would move us into a very different energy world,” IEA Executive Director Fatih Birol said in the release.
Surplus fossil fuel supplies would likely lead to lower prices and could enable countries to dedicate more resources to clean energy, moving the world into an "age of electricity," Birol said.
“In the second half of this decade, the prospect of more ample – or even surplus – supplies of oil and natural gas, depending on how geopolitical tensions evolve, would move us into a very different energy world,” IEA Executive Director Fatih Birol said in the release.
Surplus fossil fuel supplies would likely lead to lower prices and could enable countries to dedicate more resources to clean energy, moving the world into an "age of electricity," Birol said.
However, growth in clean power generation has not kept pace with rising global electricity demand and this trend is expected to continue from 2023-2030, meaning coal power use will decrease more slowly than previously expected, the IEA said.
Taking that into consideration, the share of fossil fuel in the global energy mix is forecast to be 75% in 2030 under the current policy scenario, compared with 80% today.
PEAK OIL DEMAND
In its scenario based on current government policies, global oil demand peaks before 2030 at just less than 102 million barrels/day (mb/d), and then falls back to 2023 levels of 99 mb/d by 2035, largely because of lower demand from the transport sector as electric vehicle use increases.
The report also lays out the likely impact on future oil prices if stricter environmental policies are implemented globally to combat climate change.
In the IEA’s current policies scenario, oil prices decline to $75 per barrel in 2050 from $82 per barrel in 2023.
That compares to $25 per barrel in 2050 should government actions fall in line with the goal of cutting energy sector emissions to net zero by then.
Although the report forecasts an increase in demand for liquefied natural gas (LNG) of 145 billion cubic metres (bcm) between 2023 and 2030, it said this would be outpaced by an increase in export capacity of around 270 bcm over the same period.
“The overhang in LNG capacity looks set to create a very competitive market at least until this is worked off, with prices in key importing regions averaging $6.5-8 per million British thermal units (mmBtu) to 2035,” the report said.
Asian LNG prices, regarded as an international benchmark are currently around $13 mmBtu.
It just Ain’t Gonna Happen”, why because either GDP falls back resulting in collapse of global industrial civilisation, or humanity discovers some miraculous source of unlimited energy and in accessing the minerals it needs turns Earth into an industrial wasteland, I’ll let Prof Tim Garrett explain:
Short extract from video transcription:
Prof. Tim Garrett: “I think one thing I find really quite amazing is just how fast the changes may come upon us, because our current GROWTH RATE, it may seem small, just 2.3% per year or thereabouts for our rate of energy consumption growth, but that translates to a DOUBLING in our consumption rate in just 30 years, now that's incredible because if you think that it took us 10,000 years to get to our current consumption rate and that we will DOUBLE this again in just 30 years, then we are thinking about a change in civilisation that in our very lifetimes will reproduce everything that has happened over centuries, Millennium, and that brings us to, I think, to a very basic question, how will this happen, can we sustain a DOUBLING of our daily energy consumption rate and all the raw materials that go along with it, do those raw materials exist, perhaps they do, perhaps we can figure out ways to extract sufficient resources from our environment to maintain a DOUBLING of our civilisation in the NEXT 30 YEARS, and then in the NEXT 30 YEARS BEYOND THAT, which would be FOUR TIMES AS LARGE…”🤔
Short transcript from 4 minute YouTube video “Something Has Got To Give - Prof. Tim Garrett in Ecosophia - Collapse and Regeneration”🤔
I certainly would not bank on his prediction…
but interesting topic.🙄