IEA:  Fossil Fuel Demand to Peak in 2030

Emmanuel Addeh in Abuja

The International Energy Agency (IEA) has said that with China’s shifting economy as an “important driver”, demand for fossil fuels will peak by 2030.

The IEA’s Executive Director, Fatih Birol, stated that demand for oil, coal and natural gas is on course to peak before the end of this decade.

“China changed the global energy system in the last 10 years. And China itself is changing now,” Birol, who was speaking to CNBC’s said. ”The Chinese economy is slowing down and … rebalancing, restructuring,” he added.

He described this as one of two “important drivers” behind the IEA’s belief that global demand for fossil fuels will peak by 2030. The comments come after the IEA published its World Energy Outlook 2023, a major report on the global energy system.

According to the analysis, demand for oil, coal and natural gas is on course to peak before the end of this decade, with fossil fuels’ share in the world’s energy supply dropping to 73 per cent by the year 2030 after being “stuck for decades at around 80 per cent.”

In relation to China, the IEA’s report described it as accounting for “more than 50 per cent of global energy demand growth and 85 per cent of the rise in energy sector CO2 emissions” in the past decade.

China’s economy is now shifting away from its previous reliance on industries such as steel and cement production, as well as railways and infrastructure, Birol said, adding: “They are all in a decline.”

“So China’s demand for fossil fuels will be much less than [the] last 10 years,” he added. “And this is the second driver [as to why] we believe that we will see the fossil fuel peak this decade,” he stressed.