It seems we may finally be about to hit the peak for oil demand with a study by Ricardo Strategic Consulting revealing that global demand may well peak before 2020 – and fall below 2010 demand by 2035.
The study involved some of the world’s leading energy and technology companies and outlined significant changes in future demand patterns, strongly influenced by global energy security policies.
In particular, it pointed to an evolutionary change in automotive technology leading to a decline in petrol use due to increasing powertrain efficiencies and higher pump blends of bio-ethanol.
It is expected that when oil demand peaks around 2020 it will be no more than about four per cent above 2010 levels. By 2035, it should drop to around three per cent below 2010 levels thanks in part to greater take up of biofuels. Of course there will be limits to oil demand in each country with Ricardo suggesting that in China, where demand is projected to grow nearly 60 per cent, it could peak as early as 2027 and start falling shortly thereafter.
Fuel efficient technology will have a significant role to play too. The transportation sector is expected to see significant growth with the vehicle fleet increasing by more than 80 per cent from 2010 to 2035. However, new technologies such as electric cars will be introduced and have an increasing impact over time. The study also projects that the production of first generation biofuels may increase by five-six times over today’s levels.
