Impacts on oil and electricity demand

Oil demand from road transport peaks globally in 2027 in the Economic Transition Scenario, due to the growth of alternative drivetrains, fuel economy improvements of combustion vehicles, and the proliferation of shared mobility services, which go electric faster than privately owned vehicles.

Consumption in the U.S. and Europe has already peaked; China follows in 2026, while India continues to consume increasing amounts of road fuel until 2038 in the Economic Transition Scenario. Commercial trucks remain the only segment globally yet to see a peak in demand.

In the important passenger vehicle segment, oil demand never gets within 1 million b/d of its 2019 peak. EVs and fuel cell vehicles displace 21 million b/d of oil demand by 2050 in the Economic Transition Scenario.

In the Net Zero Scenario, oil demand from road transport remains broadly similar until 2030, as it takes time for changes in vehicle sales to flow through to the fleet. From then, the rate of decline in oil demand accelerates, more than doubling the rate in the ETS.

In 2030, oil demand in road transport is some 0.7 million b/d lower in the Net Zero Scenario compared to our Economic Transition Scenario. By 2040, this gap widens to over 12.5 million b/d, and by 2050, to almost 25 million.

Governments need to develop detailed transition strategies for the industries affected by the shift to zero-emissions vehicles. This includes developing plans to recoup lost tax revenue from the sale of liquid fuels. The politically acceptable solutions for this will vary by region.

Electricity demand impacts. In the Net Zero Scenario, electricity demand remains broadly consistent with our Economic Transition Scenario until 2030 but is 61% higher by 2040, reaching 4,483TWh. By 2050, demand is 65% greater in the Net Zero Scenario than the ETS and reaches 8,524TWh.

The electricity used to charge electric vehicles on the road adds 9% to global demand by 2040 in the ETS and 14% in the NZS. By 2050, the spread between the scenarios grows, but fully electrifying almost all of road transport still adds less than 25% to global electricity demand. This increase in demand will require a quicker roll-out of grid upgrades and charging infrastructure.

The largest relative increase in electricity demand comes from medium- and heavy-duty trucks (M/HCV), which are 1.5 times higher in the Net Zero Scenario. In the Net Zero Scenario, M/HCVs need as much as two-thirds of the electricity used to charge all passenger vehicles, while the same figure is less than 40% in the ETS. Compared to lighter vehicles, these heavier trucks have radically different requirements with respect to charging infrastructure – typically rapid chargers highly concentrated in depots and truck stops.