The International Energy Agency revised its outlook on oil demand in a report published on November 12, 2025, reintroducing a “Current Policies Scenario” in which global oil consumption rises about 13% by 2050. The agency contrasted that path with last year’s projections, which showed demand plateauing or declining this decade across all scenarios. The stronger long-term trajectory in the new scenario rests largely on a slower-than-expected rollout of electric vehicles and other low-carbon substitutes. Policymakers, industry and climate stakeholders will likely read the reinstatement as a warning that current policy settings could prolong fossil-fuel dependency.
Key Takeaways
- The IEA on Nov. 12, 2025, reinstated a “Current Policies Scenario” that projects roughly a 13% increase in global oil consumption by 2050 compared with today.
- Last year’s analysis presented three scenarios in which oil demand was projected to plateau or decline during the 2020s; the new report restores an alternative path where demand grows to mid-century.
- The revised outlook is driven primarily by a slower pace of electric vehicle adoption and delayed policy interventions to curb transport-sector petrol and diesel use.
- The update was published at 05:00 UTC and amended at 10:15 UTC on November 12, 2025, indicating rapid clarification of the agency’s messaging.
- The IEA’s reinstated scenario is conditional: it assumes current policies remain largely unchanged and does not model aggressive new climate measures.
- Market impacts will depend on investment in refining capacity and producer decisions, making short- and medium-term price implications uncertain.
Background
The International Energy Agency is a leading energy-policy organization whose annual outlooks are closely watched by governments, investors and industry. In recent years the IEA’s scenarios have been used as a benchmark for how quickly the world might move away from oil under different policy and technology assumptions. In its 2024 analysis the agency presented three pathways that all showed demand stabilizing or falling through the 2020s, a signal that peak oil demand could be imminent if policies and technologies accelerate.
Over the past decade electric-vehicle technology and supportive policies in major markets—China, the European Union and the United States—have been central to expectations of lower oil use in transport. Vehicle electrification, efficiency improvements and fuel-switching in industry are the primary channels modeled to reduce oil consumption. Conversely, if these trends slow, the energy system can remain dependent on liquid fuels for longer, which is the logic underpinning the IEA’s reinstated Current Policies Scenario.
Main Event
On November 12 the IEA released an update that restored the Current Policies Scenario to its suite of modeled futures, a move that reflects an explicit recognition that not all policy commitments or technology rollouts will proceed at the most optimistic pace. The scenario shows global oil demand increasing by about 13% by 2050 relative to present levels while other modeled pathways still permit a plateau or decline in the near term. The IEA emphasized that this outcome is conditional, not a forecast: it describes what would happen if current policies persist rather than if further climate action is implemented.
The agency linked the stronger pathway to transport outcomes, especially electric vehicle adoption rates. Slower EV uptake keeps gasoline and diesel demand higher into the 2030s and beyond, sustaining refinery throughput and crude consumption. The report update also notes regional differences: growth or slower declines are most pronounced in markets where vehicle turnover, heavy transport electrification and policy incentives lag behind advanced economies.
The report’s reinstatement of the Current Policies Scenario prompted immediate commentary from market participants and climate groups. Some oil-industry representatives seized on the finding as evidence of continuing demand flexibility, while many climate advocates pointed to the scenario as a caution about the insufficiency of current commitments to meet global emissions goals. The IEA’s own language stressed conditionality and the importance of near-term policy choices in determining which pathway the system follows.
Analysis & Implications
The reappearance of a consumption-growth path to 2050 has several practical implications. First, it reduces the near-term certainty that oil demand will peak within this decade, complicating investment planning for producers and downstream companies. Capital allocation decisions—whether to expand upstream drilling, invest in refining or accelerate diversification—will be influenced by the range of plausible demand outcomes the IEA now highlights.
Second, slower EV adoption translates into sustained demand for transport fuels, which affects emissions trajectories. If policy settings and market incentives do not accelerate electrification and efficiency, emissions from the transport sector could remain elevated relative to pathways compatible with stringent climate targets. That increases pressure on policymakers who have committed to net-zero or deep-decarbonization goals to adopt stronger measures.
Third, the scenario raises questions about energy security and geopolitics. Prolonged oil demand could maintain or elevate the strategic importance of major producing regions, influencing trade patterns and fiscal balances in oil-exporting countries. Conversely, importing economies may face higher long-term exposure to price volatility if supply-side investments do not align with demand.
Finally, financial markets will read this as a signal to revisit risk assumptions. Portfolios and sovereign planning that assumed an early and sustained decline in oil use may need to stress-test for a higher-demand outcome, even as transition-related risks remain material. The IEA’s conditional framing means that policy and technology interventions remain decisive in determining which of these futures emerges.
Comparison & Data
| Scenario | Near-term trend (2020s) | Change by 2050 |
|---|---|---|
| Reinstated Current Policies Scenario | Slower decline or continued consumption in many regions | ~+13% by 2050 (IEA) |
| Scenarios in last year’s report | Plateau or decline across the 2020s | Stable or lower than today by 2050 (no single % reported) |
The table summarizes the key contrast the IEA highlighted in its Nov. 12 update: one conditional pathway sees consumption grow to mid-century, while the previously emphasized scenarios showed near-term stabilization or fall. The most material driver separating those outcomes is the assumed pace of electric-vehicle adoption and related policy action. Because the reinstated scenario is explicitly contingent on current policies, measurable shifts in regulation, subsidies or technology costs could move real-world outcomes toward the lower-demand pathways.
Reactions & Quotes
The reinstated scenario “illustrates how current policies could keep oil demand rising to mid-century,” the IEA said in its update, stressing that the pathway is conditional on unchanged policy settings.
International Energy Agency (official release)
Market analysts described the change as a reminder that technology adoption remains the key uncertainty shaping long-term demand.
Industry analysts (market commentary)
Environmental groups warned the scenario underlines the gap between current policies and pathways consistent with limiting warming, urging faster EV deployment and stronger transport-sector measures.
Climate advocacy organizations (public statement)
Unconfirmed
- Whether the IEA’s reinstated scenario will directly translate into sustained higher prices is unconfirmed; price outcomes depend on supply responses and investment decisions.
- Projections about regional demand growth patterns are subject to change as governments announce new policies or incentives that could accelerate EV adoption—these shifts are not yet fully reflected in the reinstated scenario.
Bottom Line
The IEA’s Nov. 12, 2025 update signals that under current policy settings, global oil consumption could rise about 13% by 2050, largely because of slower-than-expected electric vehicle uptake. That conditional outcome complicates assumptions that demand must peak imminently and underscores the continued importance of policy choices and technology deployment.
For policymakers and market actors, the takeaway is practical: near-term policy decisions and the pace of clean-transport technologies remain decisive. Investors should incorporate a wider range of demand outcomes into their scenarios, and climate advocates will likely press for stronger measures to ensure demand trajectories align with emissions goals.
Sources
- Bloomberg (News media) — original coverage of the IEA update published Nov. 12, 2025.
- International Energy Agency (Official agency website) — source of the agency’s scenarios and explanatory material on model assumptions.