OPEC boasts that oil is ‘irreplaceable’ and demand will increase despite claims for alternatives

Global oil demand will rise to 110 million barrels a day in about 20 years, pushing the world’s energy demand up by 23%, said OPEC on Monday.

″Oil is irreplaceable for the foreseeable future,” Secretary General Haitham Al Ghais of the Organisation of the Petroleum Exporting Countries said while addressing the inaugural Energy Asia conference held in the Malaysian capital of Kuala Lumpur.

The OPEC logo displayed at its headquarters in Vienna.

“In our worldwide outlook, we see global oil demand rising to 110 million barrels a day by 2045,” he said, adding that oil will still comprise about 29% of the energy mix by then.

The forecast contradicts the International Energy Agency’s predictions of annual demand growth thinning down from 2.4 million barrels per day in 2023 to 400,000 barrels per day in 2028.

Two weeks ago, the IEA projected that global oil demand will increase 6% from 2022 to 105.7 million barrels per day in 2028 on the back of petrochemical and aviation sectors.

OPEC’s secretary general added that underinvestment in the oil industry will only challenge the viability of current energy systems and lead to an “energy chaos.”

From now till 2030, Al Ghais predicted another half a billion people will move to cities across the world as the global economy continues to expand.

The world will need more oil — not less, he said.

Global growth is estimated to fall to a three-decade low of 2.2% a year between now and 2030, down from 2.6% for the period between 2011-2021, according to the World Bank.

Al Ghais acknowledged that renewables will play a greater role in the world’s energy mix going forward, and affirmed that some OPEC member countries are “already investing significantly” in the area.

“We see global energy demand increasing by 23% through 2045,” he said.

“Gas hydro, nuclear hydrogen and biomass will expand. But it is clear that oil remains an integral part of the mix.”

Brent crude was trading about 0.92% higher at $74.53 during Asia’s afternoon trade. West Texas Intermediate futures were up marginally by about 0.78%, trading at $69.70 per barrel.
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Credit: CNBC