Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: Electric cars are taking over the streets, big companies are trying to be nicer to the environment and people are taking action to stop climate change.
But here’s a reality check: The world could consume more oil in 2022 than ever before. Global energy demand rebounded strongly this year as pandemic restrictions eased, and it’s expected to rise further in 2022.
The International Energy Agency predicts that global oil demand will increase by 3.3 million barrels per day next year to 99.5 million barrels per day. That would match the previous demand record in 2019, before the pandemic. Not even Omicron is expected to derail the rebound.
“New containment measures put in place to halt the spread of the virus are likely to have a more muted impact on the economy versus previous Covid waves, not least because of widespread vaccination campaigns,” the IEA wrote in a report earlier this month.
The agency, which monitors energy market trends for the world’s richest countries, said it expects demand for road transportation fuels and petrochemicals to continue to post healthy growth.
The lone exception? The IEA did downgrade its forecast for jet fuel due to restrictions on international travel imposed by governments trying to stop the spread of Omicron.
Others are even less concerned about Omicron. The Organization of the Petroleum Exporting Countries (OPEC) did not change its demand forecast for 2022 in its monthly report for December.
“The impact of the new Omicron variant is expected to be mild and short-lived, as the world becomes better equipped to manage COVID-19 and its related challenges,” OPEC analysts wrote in the report.
The forecasts underscore just how dependent the world is on fossil fuels, despite efforts to address the climate crisis and huge investments in electric cars, renewable energy and cleaner fuels.
OPEC expects oil demand to increase around the world next year, led by countries including China, India and the United States.
But, remember: Even if the world does consume more oil in 2022 than ever before, the green transition is still underway.
Some of the biggest oil companies are trying to figure out how they fit into a greener future. For more on that, check out this excellent story from my CNN Business colleague Julia Horowitz. CNN
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