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India the Growth Driver
The International Energy Agency (IEA) has released its medium-term outlook, predicting that global oil demand will peak at the decade’s end. US demand is projected to fall less aggressively than last year, with electromobility expected to replace 5.4 million barrels per day by 2030.
Decreased oil use in power generation, especially in Saudi Arabia, is expected as gas and renewable energies gain prominence. Increased use in the petrochemical industry continues to drive demand. Regional shifts in demand are anticipated, with only a slight increase in China, while the US demand dip is less steep due to lower prices and slower electromobility advancement.
India emerges as the most significant growth driver but consumes 5.5 million barrels daily, compared to China’s 16.6 million. If the market conditions remain stable, the IEA forecasts that oil market capacity will grow twice as fast as demand by 2030, led by the US and Saudi Arabia.
The IEA advises that additional growth in capacity is expected at the beginning of the decade, tapering off towards its close. Users are cautioned to conduct thorough market research independently, acknowledging the inherent risks and potential for emotional distress in market investments.
Oil Demand Plateau
With projected oil market capacity set to outpace demand by a two-to-one margin by the end of the decade, a clear imbalance is likely to emerge between what’s being produced and what the market needs. The latest findings from the IEA suggest that decisions anchored in basic supply-demand logic may no longer carry the same weight going forward. Instead, strategic repositioning will be needed to adjust to longer-term shifts—not all of them immediately visible on price charts.
The forecast that demand will plateau around 2030 doesn’t just mark a symbolic end to traditional growth—it also signals practical consequences for contract pricing and volume assumptions across multiple timeframes. Particularly important for those speculating on energy-linked derivatives is the pace at which capacity expansion, especially from the US and Saudi Arabia, affects forward curve structures.
According to Birol’s agency, US output will continue to be a dominant factor, even amid a slowdown in domestic consumption. This suggests that market participants should not be overly influenced by isolated consumption trends but should instead weigh production growth in relation to export potential. The US in particular appears poised to affect global supply chains more than in past periods, making basis differentials increasingly sensitive to international flows rather than home consumption.
