11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

The world has already passed “peak oil” demand, according to

Carbon Brief analysis of the latest energy outlook from oil
major BP.

The 2020 edition (https://www.bp.com/content/dam/bp/business-

sites/en/global/corporate/pdfs/energy-economics/energy-outlook/bp-energy-outlook-

2020.pdf) of the annual outlook (https://www.bp.com/en/global/corporate/energy-

economics/energy-outlook.html) reveals – albeit indirectly – that global oil demand

will not regain the levels seen last year. It adds that demand could soon fall rapidly in
the face of stronger climate action – by at least 10% this decade and by as much as

50% over the next 20 years.

The latest outlook was delayed by six months so that it could reflect the

unprecedented impact (https://www.carbonbrief.org/iea-coronavirus-impact-on-co2-

emissions-six-times-larger-than-financial-crisis) of the coronavirus pandemic. The

delay also reflects BP’s plans (https://www.bp.com/en/global/corporate/who-we-

are/reimagining-energy.html), set out over the course of this year, to reach net-zero
emissions (https://www.bp.com/en/global/corporate/who-we-are/reimagining-
energy/aims-explained.html) by 2050 – as an “integrated energy company

(https://www.bp.com/en/global/corporate/what-we-do/our-strategy.html)”, rather
than an oil major.

This means that alongside its conservative “business-as-usual” scenario – in which

demand for gas continues to rise indefinitely – BP has also looked at the effect of Privacy - Terms

stronger climate action. In its “rapid” and “net-zero” scenarios, coal and oil see fast

https://www.carbonbrief.org/analysis-world-has-already-passed-peak-oil-bp-figures-reveal/ 1/10
11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

declines, while gas peaks by 2025 or 2035.

Although the net-zero focus is new, Carbon Brief analysis shows the outlook continues
the trend of previous editions, by cutting the prospects for fossil fuels while raising

the bar for renewables.

‘Peak oil’
Global oil demand has doubled over the past 50 years, reaching around 100m barrels

per day in 2019, equivalent to an annual energy consumption of 192 exajoules (EJ).

In earlier editions of the BP outlook, global oil demand was expected to continue

rising steadily. Indeed, successive editions had raised the outlook for oil, shown in

blue lines in the chart below.

By 2018, BP’s outlook started to foresee an end to the upwards march for oil, with

demand peaking by the mid-2030s. But the downwards revision in this year’s edition is

much more dramatic (red lines), showing demand having already peaked in 2019, with

large potential downside risks.

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

BP now concedes that oil demand has already peaked – and could soon plummet
Last year's outlook had seen peak oil still being 15 years away
225

2. Earlier BP outlooks (blue lines) had

200 seen demand continuing to go up.
Historical
175 2011
2012
Global oil demand, exajoules

150 2013
2014
2015
125
2016
2017
100 3. But BP's latest outlook 2018
says oil use has peaked… 2019
1. Global oil demand has
75 BP 2020 "B
doubled in the last 50 years.
BP 2020 "r
…and demand could plummet
BP 2020 "n
50 with stronger climate action.

25

0
1970 1980 1990 2000 2010 2020 2030 2040 2050

Global oil demand 1965-2050, exajoules. Historical data is shown in black, while previous editions of the BP
outlook are shown in shades of blue. The three scenarios from the latest 2020 edition are shown in shades of red.
Source: Carbon Brief analysis of BP Energy Outlooks (https://www.bp.com/en/global/corporate/energy-
economics/energy-outlook.html) 2011-2020, the BP Statistical Review 2020
(https://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-world-energy.html) and
International Energy Agency (https://www.iea.org/) forecasts (https://www.iea.org/reports/oil-market-report-august-
2020) for 2020. Chart by Carbon Brief using Highcharts (https://www.highcharts.com/).

In his presentation (https://www.bp.com/content/dam/bp/business-

sites/en/global/corporate/pdfs/energy-economics/energy-outlook/bp-energy-outlook-

2020-presentation-with-script.pdf) for the new outlook, BP chief economist Spencer

Dale does say that it shows oil demand having peaked in 2019, but only in two of the

three scenarios. For the “business-as-usual” scenario, he says demand is “more

resilient” and recovers to “around its pre-Covid levels” by 2025.

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

However, Carbon Brief analysis of the outlook, combined with BP figures released

separately (https://www.bp.com/en/global/corporate/energy-economics/statistical-

review-of-world-energy.html) in June, shows that oil demand would never surpass

levels seen in 2019, when measured in terms of the energy it contains.

[The outlook data (https://www.bp.com/content/dam/bp/business-

sites/en/global/corporate/xlsx/energy-economics/energy-outlook/bp-energy-outlook-
2020-summary-tables.xlsx) puts oil demand in 2018 at 190.4EJ, but does not include a

figure for 2019. The BP statistical review

(https://www.bp.com/content/dam/bp/business-

sites/en/global/corporate/xlsx/energy-economics/statistical-review/bp-stats-review-

2020-all-data.xlsx) reported oil demand growth of 0.8% between 2018 and 2019,

which Carbon Brief used to estimate demand in 2019 of 191.9EJ. This is marginally

higher than the level of demand in 2025 under the business-as-usual outlook, some
191.3EJ.]

It is interesting to compare the latest outlook to the words co-authored by Dale in a

January 2018 commentary (https://www.oxfordenergy.org/wpcms/wp-

content/uploads/2018/01/Peak-Oil-Demand-and-Long-Run-Oil-Prices-Insight-

25.pdf) with Bassam Fattouh, director of the Oxford Institute of Energy Studies

(https://www.oxfordenergy.org/). In that piece, the pair argued that the focus on peak

oil “seems misplaced”. They continued:

“More importantly, there is little reason to believe that once it does peak, that oil
demand will fall sharply. The world is likely to demand large quantities of oil for
many decades to come.”

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

In contrast, the newly released BP outlook shows that oil demand could indeed “fall

significantly”, declining by at least 10% by 2030 and by as much as 50% by 2040.

The largest reduction in oil demand is in BP’s “net-zero” scenario, where global CO2

emissions fall by more than 95% in 2050, compared to their 2018 levels.

This trajectory is, says BP, “slower” than in “below 1.5C” scenarios published by the
Intergovernmental Panel on Climate Change (https://www.ipcc.ch/), meaning faster

declines (https://www.carbonbrief.org/analysis-why-coal-use-must-plummet-this-

decade-to-keep-global-warming-below-1-5c) in fossil fuel use – or reliance on

negative emissions (https://www.carbonbrief.org/explainer-10-ways-negative-

emissions-could-slow-climate-change) – would be needed to stay within this

temperature limit.

Slowing demand
As ever, a key underlying feature of the BP outlook is its assumptions about the overall

increase in global energy demand as populations rise and incomes expand.

Historically, energy demand has risen steadily with few interruptions, as the chart

below shows. Previous editions of the BP outlook have seen demand continuing to rise

at a similar pace (blue lines), with improvements in energy efficiency being offset by
economic and population growth.

This year’s outlook marks a dramatic shift in this view, with global energy demand

growth either slowing down or even levelling off over the next three decades (red

lines).

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

BP now says global energy demand growth will slow down – or even start levelling off
Its earlier outlooks had consistently expected ever-rising demand
800

2. Earlier outlooks (blue lines) had

700 seen demand continuing to go up.
Historical
2011
600
2012
Global energy demand, exajoules

2013
500 2014
2015
2016
400
2017
2018
300 3. But BP's latest outlook shows demand 2019
slowing – or even levelling off. BP 2020 "r
BP 2020 "n
200 BP 2020 "B

1. Historically, global energy demand has

100 risen steadily, with few interruptions.

0
1970 1980 1990 2000 2010 2020 2030 2040 2050

Global energy demand 1965-2050, exajoules. Historical data is shown in black, while previous editions of the BP
outlook are shown in shades of blue. The three scenarios from the latest 2020 edition are shown in shades of red.
Source: Carbon Brief analysis of BP Energy Outlooks (https://www.bp.com/en/global/corporate/energy-
economics/energy-outlook.html) 2011-2020, the BP Statistical Review 2020
(https://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-world-energy.html) and
International Energy Agency (https://www.iea.org/) forecasts (https://www.carbonbrief.org/iea-coronavirus-impact-
on-co2-emissions-six-times-larger-than-financial-crisis) for 2020. Chart by Carbon Brief using Highcharts
(https://www.highcharts.com/).

As Carbon Brief (https://www.carbonbrief.org/analysis-bps-outlook-for-fossil-fuels-

could-be-undermined-by-slowing-energy-demand) showed last year, an ever-

expanding demand for energy has been the central driver of long-term demand for
fossil fuels in BP’s outlooks. In contrast, other organisations have suggested that
demand could slow down, leaving fossil fuels squeezed out by renewable growth.

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

Part of this year’s shift from BP is down to the coronavirus pandemic, seen clearly in
the charts above, where demand in 2020 is estimated using International Energy

Agency (https://www.iea.org/) (IEA) forecasts (https://www.carbonbrief.org/iea-

coronavirus-impact-on-co2-emissions-six-times-larger-than-financial-crisis).

According to BP, the pandemic has cut the outlook for long-term energy demand in
two ways. First, it cuts the prospects for economic growth and, second, it is assumed

that some behavioural changes – notably, home working – will persist, even as other
changes dissipate over time.

Shifting outlook
The weaker prospects for global energy demand and slower growth for oil are a

continuation of the trend in each successive edition of BP’s outlook over the past
decade.

This year’s edition once again cuts the outlook for fossil fuels, as the charts below

show, with the most dramatic revisions having been applied to coal use. (BP’s past
outlooks have also consistently raised the bar for renewable growth, but this year

leaves it largely unchanged.)

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

Each BP outlook raises renewable …but BP now concedes oil

growth… use has peaked

2011 2012 2013 2014 2015 2011 2012 2013

2016 2017 2018 2019 2020 2014 2015 2016
2017 2018 2019
200
2020
Exajoules

220

Exajoules
100 200
180
160
0 140
2000 2020 2040 2000 2020 2040

The outlook for coal has been cut …and even the gas outlook is weakening
again…
2011 2012 2013 2014 2015
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
2016 2017 2018 2019 2020 200
200
Exajoules

150
Exajoules

150

100
100

50 50
2000 2010 2020 2030 2040 2000 2010 2020 2030 2040

The outlook for hydro remains similar Nuclear keeps being nudged down

2011 2012 2013 2014 2015 2011 2012 2013 2014 2015
2016 2017 2018 2019 2020 2016 2017 2018 2019 2020

60 50

50
Exajoules

Exajoules

40
40
30
30

20 20
2000 2010 2020 2030 2040 2000 2010 2020 2030 2040

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

Global energy demand by fuel, 2000-2050, exajoules. Previous editions of the BP outlook are shown in shades of
blue. The “business-as-usual” scenario from the latest 2020 edition is shown in red. Source: Carbon Brief analysis of
BP Energy Outlooks (https://www.bp.com/en/global/corporate/energy-economics/energy-outlook.html) 2011-2020,
the BP Statistical Review 2020 (https://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-
world-energy.html) and International Energy Agency (https://www.iea.org/) forecasts
(https://www.carbonbrief.org/iea-coronavirus-impact-on-co2-emissions-six-times-larger-than-financial-crisis) for
2020. Chart by Carbon Brief using Highcharts (https://www.highcharts.com/).

While this year’s “business-as-usual” scenario does not significantly alter the outlook

for renewables compared with last year’s edition, the “rapid” and “net-zero” pathways
show the likes of wind and solar recording explosive growth over the next three

decades.

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In the net-zero scenario, renewables supply some 130EJ in 2030, more than four times
their output in 2019 and similar to current supplies from gas. By 2040, renewables

more than double again to reach 296EJ, equivalent to the current total from coal and
gas combined.

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11/13/23, 5:31 PM Analysis: World has already passed ‘peak oil’, BP figures reveal

Just three years ago (https://www.carbonbrief.org/analysis-bp-energy-outlook-sees-

coal-demand-peaking-first-time), BP’s outlook included a peak in global coal demand

for the first time. Now, it sees demand falling ever faster, dropping to a fifth below

2019 levels by 2050. In the “rapid” and “net-zero” scenarios, demand for coal falls by
one-third by 2030 and by around 90% by 2050.

Notably, this year’s outlook also trims the prospects for gas more significantly than
had been the case in previous years. There is even greater downside risk for gas in the

“net-zero” pathway, where demand peaks by 2025 and falls to 36% below 2019 levels
by 2050. The “rapid” pathway sees gas demand peaking by 2035 and returning to 2019

levels by mid-century.

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