Exxon Mobil Corp (XOM:NYSE) has released its latest global oil outlook, projecting that crude demand will remain above 100 million barrels per day through 2050, a forecast 25% higher than its European rival BP (LON: BP). This projection reflects Exxon’s ambitious production growth plans, which are the most aggressive among Western oil majors.
The company’s outlook presents a more conservative view on global carbon emissions reductions compared to BP, suggesting that technological advancements will enable emissions reductions after 2029, rather than by mid-decade as BP predicts. Exxon plans to increase its oil and gas production to 4.3 million barrels per day this year, significantly outpacing its competitors.
Chris Birdsall, Exxon’s Economics, Energy and Strategic Planning Director, told Reuters that they see oil and gas demand continuing to grow over the next few years. The company’s projections indicate that electric vehicles will not significantly impact long-term global oil demand, citing population growth as a key factor in increasing energy demand.
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Exxon’s forecast suggests that even if all new cars sold globally in 2035 were electric, crude oil demand would still be 85 million bpd, comparable to 2010 levels. This estimate contrasts sharply with the International Energy Agency’s projection of 24 million bpd needed to achieve net-zero emissions by 2050.
The company projects that fossil fuels will continue to dominate the global energy mix in 2050, accounting for 67% of energy supply. Exxon warns that without new investments, oil production could decline by about 15% per year, potentially leading to a dramatic increase in oil prices and a significant drop in global supply by 2030.
Birdsall stressed the importance of continued investments in oil production, particularly in unconventional resources like US shale, which have shorter production lifespans and steeper decline rates compared to traditional oil fields. This shift in production sources is cited as a major factor in the projected decline rates and the need for ongoing investment in the oil industry.
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