The World Will Have Too Much Oil, Experts Say

The IEA says the world will be awash in oil by 2030. Oil companies have ramped up production. Demand won’t be enough to offset that, even with rising demand from aviator and petrochemical companies over the next half-decade. “In parallel, a surge in global oil production capacity, led by the United States and other producers in the Americas, is expected to outstrip demand growth between now and 2030,” IEA experts wrote ,”  The only chance this forecast could be wrong is if government policies cut fossil fuel use and do more to fund and advance the use of renewables.

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Can the huge supply surges be offset? The IEA reports that perhaps so. EVs and renewables may push demand from oil to other sources of energy, but so much of the world runs on oil now, and oil is cheap enough that a very significant change is unlikely.

A sharp global economic slowdown could dent demand. However, that is not likely to extend for more than two years. Then, demand will ramp up again.

Peak Production

The IEA does see hope for the flood of oil production. Peak production may start in 2030. “The report’s forecast finds that as the flow of approved projects fizzles out towards the end of this decade, capacity growth slows and then stalls among the leading non-OPEC+ producers.”

Climatecrisis247 believes that government action is the only likely factor to slow demand and has been too weak to change energy use habits among individuals and industries. At the same time, US oil production in December was the highest for any month in history, driven primarily by fracking. The IEA forecast is almost certainly correct.

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