The International Energy Agency (IEA) has reaffirmed its projection that global oil demand will reach its peak and stabilize by 2030, with significant shifts expected in consumption patterns, particularly in China. The agency’s latest Oil 2025 report indicates that Chinese oil demand, which has been a primary driver of global consumption growth, adding 6 million barrels per day over the past decade, is now expected to peak in 2027 – two years earlier than previous estimates suggested.
This acceleration in China’s demand plateau is attributed to several factors, including rapid electric vehicle adoption, increased use of LNG-powered trucks, expansion of high-speed rail infrastructure, and fundamental economic restructuring. The global oil market is projected to see demand growth of 2.5 million barrels per day between 2024 and 2030, ultimately stabilizing around 105.5 million barrels per day.
The growth trajectory shows a clear deceleration, with annual increases dropping to approximately 700,000 barrels per day in 2025 and 2026, before tapering to minimal growth in subsequent years. The IEA anticipates a slight decline by 2030, based on current policy frameworks and market dynamics. This slowdown is influenced by subdued economic growth, ongoing trade disputes, fiscal challenges, and increasing adoption of alternative transport and power generation solutions.
On the supply side, the IEA forecasts production capacity to significantly exceed demand growth in the coming years. While this suggests a well-supplied market through 2030, IEA Executive Director Fatih Birol emphasizes that geopolitical tensions pose substantial risks to supply security.
The IEA’s assessment stands in stark contrast to OPEC’s outlook. The oil producers’ organization, through its Secretary General Haitham Al Ghais, maintains that oil demand will continue to expand beyond 2040, driven by global population growth. Speaking at The Global Energy Show Canada in Calgary, Al Ghais explicitly rejected the notion of peak oil demand, highlighting the fundamental disagreement between these major energy organizations.
The divergent views reflect broader uncertainty in the energy sector about the pace and extent of the transition away from fossil fuels. While the IEA points to structural changes in energy consumption patterns, particularly in transportation and industrial sectors, OPEC emphasizes demographic trends and continued reliance on conventional energy sources.
The agency’s forecast takes into account multiple factors affecting global oil markets, including below-average economic growth
expectations, increasing international trade tensions, and
accelerating shifts away from oil in key sectors. Despite the overall trend toward plateau, the IEA acknowledges significant uncertainties in its projections, particularly regarding geopolitical risks and trade-related tensions that could impact both supply and demand dynamics.
This latest forecast reinforces the IEA’s position on the energy transition while highlighting the complex interplay of technological advancement, policy changes, and economic factors shaping the future of global oil markets. The anticipated earlier peak in Chinese demand represents a significant shift in understanding how the world’s largest oil import market might evolve, with implications for global energy trade patterns and investment decisions in the oil sector.