France’s Total says oil demand could peak by 2030

Source: By Carlos Anchondo, E&E News reporter • Posted: Wednesday, September 30, 2020

French oil major Total SE said oil demand could peak by 2030 under a scenario where global warming is limited to 1.7 degrees Celsius, according to a company report yesterday.

The report, “Total Energy Outlook,” said that under a “rupture scenario” where all countries are committed to achieving net-zero carbon emissions, oil demand peaks by decade’s end and coal “almost disappears” on a worldwide scale.

“Net-zero requires a radical transformation of our energy consumption,” said Helle Kristoffersen, president of strategy and innovation at Total.

Total’s forecast adds to the number of companies expecting oil demand to crest over the next decade, though it’s not quite as aggressive as BP PLC’s assessment that oil demand may have already peaked last year, as indicated in two deep emissions reduction scenarios in its energy outlook earlier this month.

DNV GL, a Norwegian energy services company, has also predicted that 2019 could mark a peak in global demand (Climatewire, Sept. 14).

Total’s “rupture scenario” makes a number of assumptions. One is that the world would see deep emissions cuts through a massive scale-up of carbon capture technology — from the capacity to capture 35 million tons a year in 2018 to 7.5 billion tons in 2050. Electricity will make up 40% of energy demand by midcentury under the scenario, increasing from roughly 20% in 2018.

“The residual emissions in this scenario will have to be addressed through other technologies, such as nature-based solutions or future technologies like direct air capture or newer technologies still to be invented,” Kristoffersen said of the “rupture scenario.”

In the same scenario, gas retains a role, Kristoffersen said, especially in power generation and other sectors.

A second scenario in the Total outlook forecast more gradual declines in oil demand, but nowhere near the same drop-off in global carbon dioxide emissions. While the alternative forecast, “momentum,” goes beyond a business-as-usual scenario, Kristoffersen said, it “fails to meet the well below 2-degree [Celsius] target globally.”

Under “momentum,” renewables and natural gas both complement and compete with each other in terms of primary energy demand, she said.

“Oil declines very slowly over the period,” Kristoffersen added.