|Transportation demand will drive the global increase in oil consumption.|
Propelled by strong growth in the transportation sector, especially in developing economies, world oil consumption will increase to 103 million barrels per day in 10 years, and to 119 million barrels per day by 2025, according to the new International Energy Outlook 2005, released by the DOE’s EIA.
Those levels reflect a 23% increase in oil consumption from 2005 to 2015, and a 42% increase from 2005 to 2025. Those projections are slightly less than the projections made last year, as the agency has trimmed its expectations for demand growth to reflect higher oil prices.
The analysis forecasts that the growth in the use of alternative fuels through 2025 will remain “modest.”
Barring any increase in the penetration of new technologies, such as hydrogen-fueled vehicles, the use of alternative fuels is expected to remain relatively modest through 2025.
Thus, the IEO2005 reference case projection of 2.1-percent average annual growth in the world’s total energy use for transportation from 2002 to 2025 is paralleled by the forecast for transportation oil use.
The modest decrease in projected demand growth aside, the forecast still begs the question of where all that oil will come from. The increased delivery also has to compensate for an annual depletion rate that runs a guesstimated 3%–5%.
An initial look at some of the first-half production figures from non-OPEC oil majors isn’t comforting on that score—first half oil production appears flat or slightly less than the same period last year. (We’ll have a further report on that when more of the international figures are in.)
Overall, the IEO 2005 forecasts that world energy consumption will increase by 57% percent from 2002 to 2025. Global emissions of CO2 are projected to increased by 59% by 2025, rising from 24.4 billion metric tons in 2002 to 30.2 billion metric tons in 2010 and 38.8 billion metric tons in 2025.