The IEA predicts that global demand for oil, natural gas and coal is expected to peak before the end of 2030. Demand for fossil fuels, which have underpinned the modern economy since the Industrial Revolution, is nearing an inflection point. According to the International Energy Agency (IEA), consumption of the three major fossil fuels will decline over the next decade due to the rapid growth of renewable energy and the popularity of electric vehicles. This forecast will be mentioned in the World Energy Outlook report released next month.
Fatih Birol, head of the IEA, said of the forecast:
In response to climate change and the global energy crisis, governments around the world have increased investments in renewable energy. The United States' Inflation Reduction Act, the European Union's Fitfor55 and REPowerEU plans, and China's carbon peak and carbon neutrality strategy are all promoting the international community's transition to green energy.
Last year, the IEA said that total demand for fossil fuels may peak around 2030. At present, renewable energy technology has accelerated its development since this year, and this prediction also anticipates this turning point.
In last year's forecast, the IEA said in its World Energy Outlook report that investment in clean energy was expected to grow by about 50% by the end of the century, reaching $2 trillion per year, more than double the amount invested in fossil fuels in 2022.
Birol is cautious about the global climate outlook, believing that only if emissions fall rapidly after peaking around 2025, there is a chance of limiting global warming to 1.5 degrees Celsius.
In the report, Birol cited a "structural shift" in China's economy from heavy industry to less energy-intensive industry and services.
He believes that solar, wind and nuclear power will inhibit the potential growth of coal demand in the Chinese market. At the same time, he believes that countries also need to accelerate the energy transition through "stronger climate policies."
However, the market and the masses do not seem ready to adapt to this shift quickly. European Parliament President Roberta Metsola warned this month that Brussels' climate policies could sway voters to the radical other side. Separately, Metsola criticized the British government's move to support new oil and gas drilling projects.
The IEA's views have also faced criticism from large fossil fuel producers. These manufacturers believe that if current forecasts for peak consumption are too optimistic, it will lead to an energy crisis caused by insufficient investment in oil and natural gas supply.
OPEC, the Organization of the Petroleum Exporting Countries, also publicly expressed its dissatisfaction with the IEA's call to stop investing in new oil development projects in April this year, which caused a series of market "fluctuations."
Still, Birol insisted on the need to "get the new policies right" because, according to IEA forecasts, "global emissions will peak by the middle of this decade, but even with additional policies, we will still fall far short of our climate goals."