Despite global efforts to transition away from fossil fuels, oil and natural gas are projected to comprise over half of the world’s energy mix by 2050, according to a forecast released by Exxon Mobil on Monday. Currently, fossil fuels account for approximately 80% of global energy consumption, as reported by the International Energy Agency (IEA).
Exxon’s forecast indicates that while oil demand will plateau after 2030, it is expected to remain stable at over 100 million barrels per day through 2050. This persistent demand for oil and gas poses significant challenges to achieving the global goal of net-zero carbon dioxide emissions by 2050, a target aimed at limiting global warming to 1.5 degrees Celsius. The IEA has emphasized that the pathway to meeting these climate goals is becoming increasingly narrow.
According to Exxon, while the demand for gasoline will decrease over the next 25 years, crude oil consumption will remain robust due to its extensive use in manufacturing, chemical production, and heavy transportation sectors such as aviation. Even with a significant increase in electric vehicle adoption—projected to reach 17 million sales this year—oil demand in 2050 is expected to hover around 85 million barrels per day, comparable to 2010 levels.
Renewable energy sources are expanding rapidly, with global capacity growing by 50% in 2023 compared to the previous year, according to the IEA. However, the oil industry remains resistant to reducing production to meet climate objectives. Saudi Aramco CEO Amin Nasser recently described the energy transition as “failing,” dismissing the notion of phasing out oil and natural gas as unrealistic given rising demand in emerging economies.
Exxon emphasized the need for continued investment in new oil projects to keep pace with global demand. The company warned that without such investment, global oil supplies could decline sharply, leading to supply shocks, soaring energy prices, and potential economic crises.
