Demand for fossil fuels may not ever return to 2019 peak levels

While the short-term economic fallout of the global COVID-19 pandemic has already become visible, the crisis may have a significant long-term impact on global energy markets. recent research by Boston Consulting Group (BCG) suggests. Most notably, it may have brought forward an expected decline in demand for fossil fuels versus its peak last year, BCG’s report, titled Have We Passed Peak Demand for Fossil Fuels? says, according to

BCG analyses future energy demand and energy mix along three economic scenarios, representing V-, U-, and L-shaped recoveries. It sees it highly likely that the current crisis will significantly slow down the rise in global fossil fuel demand over the coming decade. Should slower economic recovery be accompanied with even a moderate acceleration in the transition from fossil fuels to renewables, as suggested by the “green recovery” measures currently introduced in many countries, demand would never recover to beyond 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 its growth path, and the trajectory for oil will put it somewhere between the other two.
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