Global oil demand is expected to slow down over the next few years, the International Energy Agency (IEA) predicted in its medium-term outlook. The agency attributes the demand dropoff to the transition toward renewable energy, spurred by high prices and Russia’s invasion of Ukraine.
The IEA claimed that global demand is expected to grow at half the rate that has been realized over the past two years. This comes as a result of the rise of electric vehicles on the market, thereby phasing out fuel-powered cars.
“Growth in the world’s demand for oil is set to slow almost to a halt in the coming years,” the report read. “The shift to a clean energy economy is picking up pace, with a peak in global oil demand in sight before the end of this decade.”
Worldwide oil production is also expected to decline as supply levels remain sufficient to meet changes in demand. The IEA expects global fuel consumption to fall to 400,000 barrels a day in 2028, with the demand for new barrels hovering around 105.7 million barrels per day around that time.