Total sees oil demand peak before 2030 in Power Switch
(Bloomberg) – French energy giant TotalEnergies SE expects global oil demand to peak before the end of this decade, as more countries crack down on fossil fuels and promote cleaner energy in transport and industry to mitigate global warming.
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Total’s 2021 energy outlook, which takes into account new net zero commitments from countries like the United States and China, assumes demand for crude will level off before 2030 and then decline, the company said in a statement on Monday. .
Although Total sees the pace of emissions reductions accelerate by 2050, governments and businesses still need to do more to meet the Paris Agreement target of limiting global warming to 1.5 degrees Celsius compared to pre-industrial levels.
“There is a key trend, which is electrification,” mainly in renewable energies, TotalEnergies CEO Patrick Pouyanne said on Monday during a conference call. “The world of energy is changing rapidly.
Total’s Momentum scenario, based on announced environmental goals and policies around the world, indicates a 2.2-2.4 degree increase in global temperatures by the end of the century. The disruptive scenario, which would limit the increase to 1.7 degrees, assumes a strong shift in public policies around the world and large-scale progress in clean energy technologies.
Fueling renewable energies
This year’s report “dramatically” increases the company’s predictions of global solar and wind investments by mid-century to electrify transportation as governments increasingly ban the sale of internal combustion vehicles.
The cost of the energy transition could be a challenge even in wealthy countries and regions like the European Union, and governments will need to mitigate those costs, especially for low-income people if they are to be successful, Pouyanne said. European authorities must also cut red tape and strive to increase public acceptance of renewables if they are to meet their goals of wind and solar energy development, he added.
Meanwhile, natural gas retains its role as a transitional fuel, especially as carbon dioxide and methane emissions are increasingly limited.
The gas shortage in Europe is partly due to a lack of investment and constraints in the supply chain since the start of the pandemic, Pouyanne said. This is also due to a 35% increase in China’s demand for liquefied natural gas this year compared to 2019, as Beijing seeks to limit the use of polluting coal, he said.
“We must follow the transition smoothly by investing more and more in renewable and carbon-free energies,” said Pouyanne. “But at the same time, we need to maintain a certain level of investment in the energies we use today.”
(Updates with comments from the CEO of TotalEnergies, details of energy demand throughout.)
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