Medium-term oil demand grows steadily, reaching 107 mb/d by 2027

Global oil demand is projected to reach almost 107 million barrels a day (mb/d) in 2027, representing a robust increase of 10 mb/d compared to 2021. Most of this increase will materialize in the non-OECD region, which accounts for 8.6 mb/d of the medium-term growth. Of this, however, more than 5 mb/d will be realized in the period to 2024. OECD oil demand is expected to see an increase of 1.4 mb/d by 2027, with the 2.4 mb/d expansion in the period to 2024, offset by a decline of 1 mb/d during the rest of the medium-term.

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In the long-term, global oil demand increases by 13 mb/d, rising to 110 mb/d

OECD oil demand is on a declining trajectory after 2024, falling to 34 mb/d by the end of the forecast period. This represents an overall demand decline of almost 11 mb/d between 2021 and 2045. In contrast, long-term non-OECD demand is expected to increase by 24 mb/d, driven by an expanding middle class, high population growth and stronger economic growth potential. As a result, global oil demand is projected to increase by 12.9 mb/d, rising to 109.8 mb/d in 2045. Overall growth slows over the projection period, with virtually no increase after 2035, hinting to a relatively long period of plateauing oil demand at the global level. This will be driven by energy policies and technology developments that both play an increasing role in diversifying the future energy mix.

Long-term demand growth to increasingly come from India, Africa and Other Asia

Non-OECD demand prospects are marked by strong demand growth. In the initial years of the forecast period, this growth will be driven by China. In the later period, India will take the leading role with demand growth in China slowing significantly and even turning to a marginal decline over the last five years of the forecast period. Besides India, fairly robust growth during this period is also projected for Africa and Other Asia where economic progress, urbanization, industrialization and vehicle fleet expansion will be fastest among all regions. This will result in respective demand increases of around 1.4 mb/d, 0.8 mb/d and 0.7 mb/d, for India, Africa and Other Asia, during the 2040–2045 period. Even by 2045, oil demand will still grow at a rate of more than 2% p.a. in India and Africa and 1% p.a. in Other Asia.

Aviation, road transportation and petrochemical sectors will be the main contributors to future incremental oil demand

Aviation, road transportation and petrochemical sectors will each see oil demand grow by around 4 mb/d between 2021 and 2045. The largest demand increase, estimated at 4.1 mb/d between 2021 and 2045, comes from the aviation sector. Considering 2021 as a basis for comparison, however, more than 1 mb/d of this expansion is needed to just reach pre-pandemic levels, which will likely not be achieved before 2024.
After an initial few years of growth, oil demand in the road transportation sector is expected to stay in a very narrow range of just below 47 mb/d as developments in the passenger car segment offset impacts on the commercial vehicles segment. The total vehicle fleet is anticipated to reach 2.5 billion by 2045, an increase of almost 1 billion from 2021 levels. The EV fleet approaches 540 million vehicles by 2045, representing more than 22% of the global fleet.
The overall demand increase in the petrochemical sector is forecast to be 3.7 mb/d. The overwhelming majority of this growth is set to come from Asian countries and the Middle East. Minor growth is also projected for Latin America, Africa and Russia. Meanwhile, OECD oil use for petrochemicals at the end of the forecast period will be lower than in 2021, despite some temporary growth during the current decade.

Future incremental demand almost equally split between light products and middle distillates

Mirroring projected developments at the sectoral level, incremental demand is set to be almost equally split between light products and middle distillates, with virtually no growth projected for the heavy end of the refined barrel. Major demand growth over the forecast period is expected for jet/kerosene (+3.8 mb/d), followed by ethane/liquefied petroleum gas (+2.6 mb/d), diesel/gasoil (+2.4 mb/d), naphtha (+2 mb/d) and gasoline (+1.9 mb/d).