The world’s current energy trajectory is set to overshoot the crucial 2∘C carbon budget limit within the next two decades, according to a sobering report from BP. The energy major has upwardly revised its long-term oil and gas demand forecasts, providing clear evidence that the pace of the global energy transition is insufficient to meet the collective 2050 net-zero ambition.
BP’s annual outlook paints a persistent picture of fossil fuel dominance. The forecast for oil consumption in 2050 has been raised by 8%, now projected to reach 83 million barrels per day (b/d), significantly higher than the previous estimate of 77 million b/d. Natural gas demand is also forecast to hold strong, rising marginally to 4,806 billion cubic meters annually in 2050. Furthermore, the global peak for oil demand is now anticipated five years later, in 2030, at 103 million b/d, signifying prolonged reliance on crude.
A central factor driving this revised outlook is the global emphasis on energy security, intensified by ongoing geopolitical conflicts and trade disputes, including the war in Ukraine and Middle East tensions. BP’s analysis suggests that this security-first mindset is encouraging nations to prioritize domestic supplies. While this could potentially spur the creation of ‘electrostates’ focusing on domestic, low-carbon energy, it also risks pushing states toward greater extraction and reliance on domestically produced fossil fuels as the path of least resistance.
The environmental consequence of this slowed transition is immediate and serious. BP’s modeling indicates that if the current pathway is maintained, cumulative carbon emissions will exhaust the 2∘C carbon budget by the early 2040s. This premature breach, the report cautions, increases the risk that an extended period of delay will substantially raise the economic and social cost of future attempts to remain within safe warming limits. To align with the 2050 net-zero goal, oil demand must see an intense and immediate decline, dropping to around 35 million b/d by 2050.
Despite significant investment and growth in clean energy—with wind and solar expected to meet over 80% of new electricity demand growth by 2035—oil is forecast to remain the single largest source of primary global energy supply, maintaining a substantial 30% share in 2035. Renewables are only projected to rise from 10% to 15% of the primary energy supply by 2035, and are not expected to surpass oil until the end of the 2040s. This protracted timeline for a fundamental energy shift comes as BP itself faces scrutiny for recently resetting its strategy to prioritize oil and gas production over previous green targets.