International Energy Agency’s 2021 oil report

International Energy Agency’s 2021 oil report

The International Energy Agency’s (IEA) 2021 oil market report provides some interesting insight into their views for the sector. Below are a number of quotes from the report that present a strong case for the importance of oil as a key contributor to the energy mix and the need for a considered and orderly transition:

“…..by 2026, global oil consumption is projected to reach 104.1 mb/d. This would represent an increase of 4.4 mb/d from 2019 levels.”

“…..sharp spending cuts and project delays are already constraining supply growth across the globe, with world oil production capacity now set to increase by 5 mb/d by 2026. In the absence of stronger policy action, global oil production would need to rise 10.2 mb/d by 2026 to meet the expected rebound in demand.”

“It is crucial to invest in the upstream sector even during rapid transitions in which it would still take years to shift global transport fleets away from internal combustion engines to electric vehicles and other low-carbon alternatives. Some sectors – such as aviation, shipping and petrochemicals – will continue to rely on oil for some time.”

“Whatever the transition pathway, the oil and gas industry has an important role to play, and no energy company will be unaffected.”

“An effective and orderly transition will be critical – not only to reach international climate targets but also to prevent serious supply disruptions and destabilising price volatility along the way.”

If you have time, the full IEA report that provides an analysis on the industry to 2026 can be accessed at www.iea.org/reports/oil-2021