World oil demand is heading for a record high this year. Our latest monthly Oil Market Report forecasts that demand will reach over 102 million barrels per day in 2023. That would translate to an annual rise of 2.2 million barrels per day, with China accounting for more than 70% of the growth.
As we have been warning since the start of the year, the global oil market is tightening as this rise in demand comes up against deepening cuts to output by OPEC+ countries. In July, oil supply from the OPEC+ alliance fell to a near two-year low as a voluntary reduction from Saudi Arabia took effect. The bloc’s production was down more than 2 million barrels per day from the start of the year.
Crude oil and oil products inventories have drawn down sharply as a result. And market balances are poised to tighten further into the autumn as Saudi Arabia and Russia extend supply cuts at least through September. Find out more in the report’s highlights and overview.
Global coal demand set to remain at record levels this year
Global coal consumption climbed to an all-time high in 2022 and will stay near that record level this year, according to our latest Coal Market Update, providing a stark reality check on efforts to reach international climate goals and highlighting the need to spur faster growth of clean energy.
In some Asian economies, where energy needs are rising fast, coal use is growing for both power generation and industry, outpacing declines in coal consumption in the United States and Europe. China, India and Southeast Asian countries together are expected to account for three out of every four tonnes of coal consumed worldwide in 2023.
Meanwhile, coal use in the European Union is expected to fall sharply this year as renewables expand, and as nuclear and hydropower partially recover from recent slumps. In the United States, the move away from coal has been accentuated recently by lower natural gas prices.
Read the press release and the full report – and take a look at our special report last year on Coal in Net Zero Transitions, which looked at strategies for rapid, secure and people-centred ways of reducing coal’s huge carbon dioxide emissions.
Designing clean energy policies with people at the centre
Putting people and inclusivity at the centre of all clean energy transitions plays a crucial role in effectively implementing energy and climate policies. It also presents an important opportunity to address existing social and economic inequalities, according to our new commentary.
As clean energy adoption picks up pace, governments should seize the moment, developing comprehensive policies that address climate action, poverty reduction and inequity simultaneously.
Equality and inclusion must also be built into clean energy policies to mitigate the risk of disproportionate or unintended consequences for certain segments of society. For instance, government incentives for retrofits intended to make buildings more energy efficient can immediately help low-income households by creating jobs in the construction sector. But the increased market value of the upgraded, energy-efficient properties could then lead to higher rents in the area. Careful policy design is essential.
Also worth reading is our recent commentary on the benefits of community-based energy projects. These projects are receiving increased attention as effective vehicles towards more inclusive, equitable and resilient energy systems. One example is local community-based electricity generation, sharing and consumption, which has been shown to save costs and ease grid strains in Australia.