Every year, BP releases an annual energy report that outlines key trends and predictions for the global energy market. The latest report highlights a significant shift in transportation demand, suggesting that the rise of autonomous electric vehicles and shared mobility could reduce oil consumption in the transport sector. However, it also notes that growing energy needs from emerging economies like China and India will offset some of this decline, driving overall global energy demand higher.
This year’s report extends its forecast period to 2040, offering a more comprehensive view of how energy demand may evolve across different sectors and regions. It emphasizes a gradual transition scenario—where policy changes, technological advancements, and societal preferences develop at a pace similar to recent years. Under this assumption, several key developments are expected.
First, China and India will play a major role in boosting global energy demand. The report predicts that these two countries will account for over one-third of the global increase in energy use by 2040, with India being the primary growth driver. While China’s oil demand is expected to slow down in the 2030s, both nations will continue to fuel rising global energy consumption.
At the same time, the world is moving toward greater energy efficiency. For example, the EU is projected to triple its GDP by 2040 compared to 1975 levels, while keeping energy demand nearly constant. Overall, the report forecasts that global GDP will more than double by 2040, but energy consumption will only rise by 35%, showing a clear trend toward more efficient use of resources.
By 2040, the global energy mix will look very different. Oil, natural gas, coal, and non-fossil fuels will each make up roughly 25% of the total. Natural gas is expected to grow rapidly, surpassing coal as the second-largest energy source. Renewable energy demand will surge fivefold, accounting for 40% of the total increase, and its share of the energy mix will rise from 4% today to 14% by 2040.
Electric vehicles (EVs) are also a major focus of the report. It predicts that EVs will make up 15% of all vehicles on the road by 2040, with their usage frequency increasing significantly—accounting for 30% of total mileage. The number of EVs worldwide is expected to reach nearly 190 million by 2035, jumping to 320 million by 2040. That’s a massive increase from the current 3 million units, driven by strong growth in hybrid vehicles and a surge in EV sales between 2035 and 2040. At the same time, the global car population is expected to grow by 15%, reaching 2 billion vehicles.
Spencer Dale, BP’s chief economist, noted that the widespread adoption of EVs could fundamentally reshape the energy market. The report even considers an extreme scenario where oil demand falls by 10 million barrels per day after 2040 if global sales of fossil-fuel vehicles are banned.
Another transformative trend highlighted in the report is the rise of shared, self-driving electric vehicles. These technologies are expected to replace traditional private car ownership, leading to more frequent vehicle use and lower costs. Electric vehicles, due to their lower operating costs, are likely to dominate the shared mobility market. As a result, their penetration could have a significant impact on oil demand.
The report predicts that by the 2030s, shared autonomous vehicles will become widely available. Initially, they may be owned by institutions and offered as services, making them more affordable for consumers. Once fully automated, ride costs could drop by 40–50%, further accelerating adoption.
Finally, the report forecasts that global oil demand will peak in the late 2030s at around 110 million barrels per day. Unlike previous reports, this is the first time BP has made such a prediction. While transportation remains the largest oil-consuming sector, the petrochemical industry—especially plastics manufacturing—is expected to see stronger growth. However, stricter regulations on plastic use could reduce oil demand in this sector by about 200 million barrels per day.
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