BP’s new annual outlook confirms what its recent strategic shift signaled: the global commitment to clean energy transition is wavering. The energy major has significantly increased its long-term oil and gas demand forecasts, reflecting a world prioritizing immediate energy security—a move that strongly suggests the 2050 net-zero emissions goal will be missed. The report comes just after BP’s internal ‘fundamental reset’ to ramp up hydrocarbon production.
The company’s updated projections reveal a sustained appetite for fossil fuels. Oil use is now estimated to hit 83 million barrels per day (b/d) in 2050, an 8% upward revision from the previous 77 million b/d forecast. Natural gas demand also remains stubbornly high, forecast at 4,806 billion cubic meters annually in 2050. Compounding this, BP has delayed its forecast for peak oil demand by five years, now projecting 103 million b/d in 2030.
The primary impetus for this slow-motion transition is the current volatile geopolitical landscape. BP’s chief economist points to the war in Ukraine, conflicts in the Middle East, and increasing trade tariffs as factors driving nations to intensify their demands for national energy security. This security-first approach could theoretically lead to ‘electrostates’ focused on domestic, low-carbon energy, but the report warns that it also encourages a strong preference for boosting domestically produced fossil fuels over reliance on international markets.
This slower pace has direct and dire consequences for the climate. BP’s modeling demonstrates that maintaining the current trajectory will exhaust the 2∘C carbon budget limit by the early 2040s. The report emphasizes that every year of delay in fundamental decarbonization increases the economic and social cost of future necessary mitigation measures. Meeting the 2050 net-zero target is contingent on a dramatic and immediate shift, requiring oil consumption to fall to approximately 35 million b/d by that date.
Despite the rapid, necessary growth in renewables—which are set to meet over 80% of new electricity demand by 2035—oil will retain its dominant position. Oil is forecast to remain the single largest source of primary global energy supply, holding a 30% share in 2035. Renewables, projected to rise from 10% of primary energy supply in 2023 to 15% in 2035, are not expected to surpass oil’s market share until the end of the 2040s. This decade-long inertia in the energy mix transition highlights the scale of the challenge for climate campaigners, who have criticized BP’s recent abandonment of some green targets in favor of ramping up oil and gas production.