(Oil Price) – Crude oil demand will remain at current levels over the next 15 years at least, commodity trading major Vitol has forecast, shattering earlier predictions from outlets such as the International Energy Agency that has consistently been predicting peak oil demand growth before 2030.
Demand for crude is set to rise further in the coming years, to peak at around 110 million barrels daily, the commodity giant said in its long-term report, adding that after it reaches that peak, it would begin declining, to reach the current level of daily average demand at 105 million bpd in 2040.
To compare, the International Energy Agency expects crude oil demand to peak at a little over 105 million barrels daily in four years. BP is also a lot more pessimistic about demand than Vitol expecting the daily average to peak around the end of the decade and gradually decline to just 91.4 million barrels daily by 2040, the Financial Times noted in a report on Vitol’s forecast. The FT added, however, that the BP forecast was a 6% increase on earlier predictions for oil demand developments, suggesting the supermajor is acknowledging the realities of the energy transition rather than the hopes and plans.
Vitol’s forecast, however, does not mean that the transition has stopped, with the commodity trader pointing out that gasoline demand will decline under the onslaught of electric vehicles—admittedly mostly in China—but the loss of gasoline demand would be offset by demand for petrochemicals.
Vitol’s analysts expect petrochemicals demand to add some 6 million barrels daily by 2040 when it would come to account for 20% of all crude oil consumed globally. Meanwhile, gasoline demand is seen declining by 4.5 million barrels daily over the next 15 years. Liquefied petroleum gas demand is also set for growth over the next decade and a half, Vitol said.
By Irina Slav for Oilprice.com
