Oil

Global oil demand rebounded in 2021 from its Covid-induced historic decline but its longer-term outlook is uncertain because of challenges from alternative fuels and changing behaviour of drivers and commuters. Oil use for transportation could go into decline in 2026, and while oil’s role as a key ingredient in plastics and other chemicals will continue to drive global consumption, peak demand could be in sight after 2028.

IEA member countries have an obligation to hold oil stocks equivalent to at least 90 days of net oil imports and to be ready to collectively respond to severe supply disruptions affecting the global oil market, such as Russia's invasion of Ukraine. As oil is expected to remain a major component of global energy demand for the coming decades, particularly for the transportation sector, maintaining the IEA emergency response capability will continue to remain essential.

The oil market today is grappling with huge near-term and long-term uncertainties. Based on existing policy settings, growth in world oil demand is set to slow markedly over the next several years as the energy transition advances. In the Net Zero Emissions by 2050 Scenario, behaviour changes and increases in low‑emissions liquid fuels mean oil demand barely increases to 2030.