Total Predicts Peak Oil in 2030
France's Total has predicted that oil demand will stop growing around 2030, which is a more conservative forecast than that of BP, which recently estimated that oil consumption might never return to pre-coronavirus pandemic levels.
In its Energy Outlook report published on September 29, Total said that energy demand would continue growing in all the scenarios considered, but that extra consumption would be met by low-carbon power. Electricity's share of final energy demand will increase to 30-40% by 2050, it said, up from 20% at present. The outlook for gas is stronger than for oil, Total said, predicting the fuel would play an important role for decades even if net-zero targets are adopted worldwide.
Total based its predictions on two main scenarios: Momentum and Rupture. Both scenarios assume Europe will meet its goal of becoming carbon-neutral by 2050 under the European Green Deal. In Momentum, countries outside of Europe pursue their existing national climate goals as of 2019 and there is aggressive deployment of proven technologies such as electric vehicles, solar, wind and biofuel.
"Momentum goes beyond the business-as-usual scenario, nevertheless it fails the well-below 2oC target globally," Total's president for strategy-innovation, Helle Kristoffersen, said.
Rupture envisages all countries in the world committing to net-zero targets, as well as breakthroughs in clean technologies such as hydrogen, synthetic fuels and carbon capture, allowing them to be deployed at scale. This would enable the world to cap temperature growth at 1.5-1.7oC. Primary energy demand increases by 0.6%/year in Momentum and by 0.4%/yr in Rupture.
Solar and wind power will be deployed at a rate of over 200 GW of capacity/yr in Momentum and over 500 GW/yr in Rupture, up from 100 GW/yr in 2018. Meanwhile, green gas will account for around 8% of total gas supply by 2050 in Momentum and more than 25% in Rupture, up from 0.1% in 2018. The share of electric vehicles in transport increase from 1% to 60% in the first scenario and 75% in the second, while carbon capture and storage (CCS) capacity will be scaled up t0 2-7.5 gigatons/yr
"Oil demand will reach a plateau around 2030 and then decline slowly thereafter due to transport and petrochem accelerated transformation," Kristoffersen said. "Gas will continue to play a key role for decades. It has a key role to play in power systems, heat and in transport."
Gas will seize market share from coal and oil. In Momentum, demand for the fuel will increase by 1.3%/yr and reach 5.7 trillion m3 in 2050, driven by growth in Asia where there is a lot of coal to substitute. Gas will remain vital in power generation, as well as in industry and residential and commercial sectors. It will also gain market share in transport, primarily in truck and marine bunkering.
"However, to fully play its role in the energy transition, gas has to become much greener and much cleaner," Kristoffersen said. "That will come at a cost, at least in the early years." In Momentum, the share of green gas will be limited by the fact that it is much more expensive and insufficient carbon regulation, she said.
Gas will still be key to ensuring power grid stability and flexibility at an affordable cost in Rupture, Total said. While unblended natural gas demand will peak in 2040, consumption will continue rising beyond 2050 if green gases including hydrogen are also counted. The company stressed hydrogen's potential for decarbonising industry, heavy duty transport and gases.