Search DubaiPRNetwork.com

Home >> Energy and Industry

Peak Demand for Fossil Fuels in 2019 Has Become a Real Possibility

Peak Demand for Fossil Fuels in 2019 Has Become a Real Possibility

Sunday, June 28, 2020/ Editor -  

Share

Home >> Energy and Industry

New Analysis by Boston Consulting Group Reveals That the COVID-19 Crisis May Have Accelerated Peak Demand for Fossil Fuel by More Than a Decade, Causing It to Reach Its Zenith in 2019

 

Dubai, United Arab Emirates, June 28, 2020:   As the short-term economic fallout of the global COVID-19 pandemic becomes increasingly visible, recent research by Boston Consulting Group (BCG) suggests that the crisis may have a significant long-term impact on global energy markets. Most notably, it may have caused demand for fossil fuels to reach its peak last year. BCG’s article, titled Have We Passed Peak Demand for Fossil Fuels? explores energy scenarios through 2030.

BCG’s analysis of the future energy demand and energy mix for three economic scenarios, representing V-, U-, and L-shaped recoveries, points to a high likelihood that the current crisis will significantly slow world fossil fuel demand over the coming decade. In a scenario combining slower economic recovery with moderate acceleration of the transition from fossil fuels to renewables, as suggested by the “green recovery” measures currently introduced in many countries, demand would never recover beyond 2019 levels.

 

Demand for Fossil Fuels May Not Recover to 2019 Levels

 

In such a scenario, the impact would differ by commodity and by region. Coal is the fossil fuel least likely to recover, BCG expects. Meanwhile, demand for natural gas is likely to resume a growth path, and the trajectory for oil will put it somewhere between the other two.

“We may have reached a critical turning point for energy markets. The economic impact of the coronavirus pandemic, decreasingly energy-intensive economic growth, and continued investments in sustainable energy are hitting fossil fuel demand,” said Patrick Herhold, a managing director and partner at BCG. “This would fundamentally change the reality for many energy companies much earlier than they expected.”

Depending on the recovery scenario, energy companies’ margins and capital market standing will come under pressure. They will need to reduce costs and increase resilience against a longer-term environment of low prices, while at the same time accelerating efforts to transform their business portfolios, operations, and investment.

In the fight against climate change, reaching the crest of 'peak fossil fuel' demand is no reason for complacency. “Peak demand for fossil fuels may be behind us, but not necessarily for the right reasons” said Jens Burchardt, an associate director at BCG. “If we do not fundamentally transform our economy, projected emissions remain incompatible with a 1.5°C or 2°C path. A low-price environment for fossil fuels will not make this transformation easier.” 


Previous in Energy and Industry

Next in Energy and Industry


Home >> Energy and Industry Section

Latest Press Release

GEMS Education students achieve outstanding IB Diploma results

MBRU Opens Grant Applications for Enriching Health and Biomedical Science Resear ...

It All Started with a Sponge- Gaetano Pesce's Revolutionary Feminist Chair “UP” ...

Catch Academy Launches in the UAE

First Scheduled Wizz Air Flight Lands at Abu Dhabi International Airport

Strata Delivers 100 Shipsets of A350-900 Inboard Flaps for Airbus

BMW Announces Support for Digital Key for Iphone. A Secure and Easy Way to Use I ...

International Day of Cooperatives 2020: Union Coop Urges Cooperatives to Join Ha ...

Celebrate Eid with Steve Madden

The US Dollar is Still the Centre of Gravity

EY: 33% of MENA Consumers to Stay Frugal after COVID-19 Pandemic

Dubai Sports Council Honours Winners of Pocari Sweat 19K Run

Al-futtaim Malls Announces Huge Deals From 50% Off and More on Over 100 Brands a ...

Dubai Chamber and DAFZA Collaborate to Connect Digital Services

Formula E CEO Jamie Reigle Joins Re:charge @ Home - Panasonic Jaguar Racing's Vi ...

Hope Probe: Raising Ambitions, Inspiring Nations

Toric Tourbillon Slate''

Kids Paradise Nursery to Host Responsible UAE Competition

Gems Education Rolls Out IBM Digital – Nation Platform to All Its Schools Follow ...

ACI and IATA Call for Governments to Bear Costs of Public Health Measures