Global Energy & CO2 Status Report

The latest trends in energy and emissions in 2017

The IEA’s first Global Energy and CO2 Status Report – released in March 2018 – provides a snapshot of recent global trends and developments across fuels, renewable sources, and energy efficiency and carbon emissions, in 2017. Download the full report

Latest trends in oil

World oil demand rose by 1.6% (1.5 million barrels a day) in 2017, a much higher rate than the annual average of 1% seen over the last decade.* An increasing share of SUVs and light trucks in major economies and demand from the petrochemicals sector bolstered this growth.

	Oil demand growth	Net growth rate (right axis)
1985-2005	1.136	1.61
2006-2015	0.899	1.03
2016	1.259	1.36
2017	1.536	1.64
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Global oil demand rose by 1.5 million barrels a day (mb/d) in 2017, continuing a trend of strong growth since prices fell in 2014. The rate of growth of 1.6% was much higher than the average annual growth rate of 1% seen over the past decade.*

One of the main drivers of growth was the transport sector. Vehicle ownership levels increased in 2017, as did the share of Sport Utility Vehicles (SUVs) and other large vehicles. This was particularly visible in the United States, where the share of SUVs and light trucks increased from 47% in 2011 to around 60% of total sales in 2017, bringing up the share of these vehicles in the total passenger car fleet to almost half. It is also a factor in the European Union, where oil demand increased by 2%, the highest rate of growth since 2001.

The trend towards larger vehicles has also slowed the pace of decline in average vehicle fuel use, partly offsetting energy efficiency policy efforts. Electric cars are making rapid inroads in many markets, particularly in China, which is leading global sales. For now, however, the strong growth in electric-car sales remains too small to make a dent in oil demand growth. (An updated analysis will be included in the IEA’s next Global EV Outlook, to be released in May).

Another reason behind robust demand growth is oil used as a petrochemicals feedstock. Petrochemicals are the fastest-growing source of oil demand, notably in the United States, where the shale revolution has created very cost-competitive domestic supplies, as well as in China and in other emerging economies, where demand for plastics and other petrochemical products is growing rapidly. It should be noted, however, that the oil use in the petrochemicals sector only has a very small impact on emissions trends as most of the oil is not combusted but transformed into other products, such as plastics.

Around 60% of the growth in oil demand came from Asia. Although China is the leading global market for the sales of electric cars, it was also the top contributor to oil demand growth, followed by India. Meanwhile, oil demand in the Middle East, a recent source of demand growth, was flat due to oil-to-gas switching in the power sector and efforts to reform oil product prices and phase out subsidies.

While a slowdown in oil demand growth may be likely in coming years, there are no signs of a peak in demand anytime soon. As noted in the IEA’s recent World Energy Outlook 2017 and Oil 2018 reports, it is too soon to write the obituary for oil.

* Corrected 20 April from "double" to "much higher than"