BP expects oil demand to grow over the next 20 years but at a slowing rate, as the transport sector rises in efficient consumption, and natural gas and renewables take a larger share of the energy mix, the oil major said in its 2017 Energy Outlook.

“The overall demand for energy looks set to continue to expand, as increasing prosperity in fast-growing emerging economies lifts billions of people from low incomes,” Bob Dudley, chief executive of BP said in the report. “The extent of this increase is likely to be curbed by improvements in energy efficiency, as increasing attention around the world is devoted to using energy more sustainably.”

Energy demand is set to grow by just 30 per cent over the next 20 years, despite a sharp rise in population. The BP report forecasts this trend to be offset by sharp gains in energy efficiency.

It says oil demand growth over the period is set to slow from around 1 million barrels per day to 400,000 bpd by 2035, when consumption will reach around 110 million bpd.

More efficiencies and cleaner fuel mix will also lead to a slowdown sharply in carbon emissions, BP said, growing at less than a third of the rate of the past 20 years.

“The increasing penetration of electric cars and the broader mobility revolution will have an important bearing on future oil demand,” BP said.

Oil demand from cars will rise from around 19 million bpd in 2015 to 23 million bpd in 2035, BP said. That will come amid rapid growth in the car fleet and despite improvements in engine efficiencies and an expected 100-fold expansion in the number of electric vehicles to 100 million over the period.

Renewables, with nuclear and hydroelectric power, will provide half of the additional energy required out to 2035, while gas will grow more quickly than oil and coal, led by US shale gas, it said.

Electricity, biofuels, coal and natural gas together account for 13 per cent of transport fuel demand in 2035, up from 7 per cent in 2015.

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