Oil demand could plateau by 2030 or sooner, Total said today, depending on the speed of the energy transition.
In its Energy Outlook released today, Total said oil consumption will flatline around the end of this decade and then decline under its Momentum scenario, which it defines as "in line with best practices, but not enough to meet the well-below 2C targets globally." In its Rupture scenario, which is consistent with the climate goals of temperatures rising by 1.5C-1.7C, oil demand peaks before 2030 and coal "almost disappears" by 2050.
Total's Momentum scenario sees accelerated innovation to substitute oil use, for example with biofuels, and energy efficiency gains and regulation that affect oil demand in transport and petrochemicals, "with Europe leading the way." The Rupture scenario "requires massive adoption of sustainable liquids fuels, reaching more than 20pc of liquids demand in 2050." It said that this scenario still envisages around 45mn b/d of oil demand in 2050, mainly in emerging markets' transportation.
Total's outlook follows those of its European peers BP and Shell, both of which also signalled that oil demand peaks as soon as this decade. BP, in its Energy Outlook released earlier this month, said that global oil demand has already peaked in two of its three main scenarios. Shell said that global oil demand peaks before 2030 in two of the three "pathways" it modelled in the new Covid-19 world.
In Total's outlook, global primary energy demand increases in both its scenarios over the next three decades, by 25pc in Momentum and by 10pc in Rupture. The company said that gas will continue to play a key role for decades, in power systems, heating and transport.
"Significant investments in new oil and gas projects [are] needed to offset natural decline, and in renewables to support low-carbon electrification," it said.
Total, one of the most active oil and gas companies in the new energies space, will present its updated business strategy tomorrow.
