The early 2040s are set to mark the exhaustion of the cumulative 2∘C carbon budget, according to grim modeling in BP’s latest annual outlook. This timeline confirms that the world is on a dangerous trajectory, with the energy major raising its long-term oil and gas demand forecasts and concluding that the 2050 net-zero target is unlikely.
BP’s revised figures indicate a persistent reliance on hydrocarbons. Oil consumption in 2050 is now projected to hit 83 million barrels per day (b/d), an 8% increase from the previous 77 million b/d estimate. Natural gas demand is similarly forecast to remain elevated at 4,806 billion cubic meters annually in 2050. Furthermore, BP has delayed the expected date of peak oil demand by five years, now projecting 103 million b/d in 2030.
The primary reason for this slow transition is the overriding focus on national energy security, amplified by geopolitical factors. BP’s chief economist attributes the trend to the war in Ukraine, Middle East conflicts, and rising trade tariffs. This drive for self-sufficiency risks encouraging reliance on domestically produced fossil fuels, even as it creates an incentive for some countries to accelerate towards low-carbon ‘electrostates.’
The report emphasizes the need for an immediate, sharp decline in oil demand. To meet the 2050 net-zero goal, BP states that oil demand must drop aggressively to about 35 million b/d by 2050. The failure to achieve this reduction will lead to the predicted budget breach, significantly increasing the economic and social costs required for future mitigation.
Despite the necessary and rapid growth of renewables—projected to meet over 80% of new electricity demand by 2035—oil will remain the largest single source of primary global energy supply, holding a 30% share in 2035. Renewables are set to rise from 10% to 15% of the primary energy supply by 2035 but are not expected to surpass oil’s market share until the late 2040s.