Goldman Sachs Now Sees Oil Demand Growing Into 2040
Global oil demand is expected to continue rising through at least 2040, according to a new report from Goldman Sachs—marking a shift from its previous prediction that demand would peak by 2034. The bank’s updated outlook aligns with recent projections from the International Energy Agency (IEA), which also anticipates sustained demand growth over the coming decades.
A Higher-Than-Expected Long-Term Oil Demand Outlook
Goldman Sachs forecasts that global oil consumption will reach 113 million barrels per day by 2040, up from approximately 103.5 million barrels per day in 2024.
Projected growth timeline:
- 2025–2030: ~900,000 barrels per day of annual demand growth
- 2030–2040: Gradual slowdown to ~100,000 barrels per day annually
- Early 2040s: A long plateau, not an immediate peak
This indicates a longer runway for oil compared to previous expectations, even as global economies push toward cleaner energy solutions.
Why Oil Demand Will Continue Rising
Goldman’s analysts highlight several structural factors that are keeping oil demand resilient despite rapid investment in low-carbon technologies:
1. Limited Alternatives for Jet Fuel and Petrochemicals
Air travel and plastics remain heavily dependent on oil. Current technology, infrastructure, and cost barriers make large-scale substitutes difficult to deploy.
2. AI-Driven Economic Growth Increasing Energy Needs
Artificial intelligence is projected to accelerate global GDP growth, indirectly boosting overall energy consumption, including oil.
3. Low-Carbon Transition Not Expanding Fast Enough
While renewable and low-carbon technologies are scaling up, their pace is not fast enough to offset growing global energy demand.
Analysts Yulia Grigsby and Daan Struyven note that they do not assume major technological breakthroughs, especially in areas like sustainable aviation fuel or petrochemical alternatives.
Road Transportation: A Long Plateau Instead of a Rapid Decline
Even as electric vehicles expand, Goldman expects road oil demand to level off after 2030 rather than collapse. The report also points out that LNG-powered trucks are unlikely to see widespread adoption outside China, limiting alternatives in heavy transport.
Uncertainty Remains in Long-Range Forecasts
Goldman Sachs emphasizes that long-term energy forecasts carry significant uncertainty. Potential disruptors include:
- Faster-than-expected low-carbon technology progress
- Policy changes and climate regulations
- Economic downturns or global recessions
- Shifts in consumer behavior
Despite these risks, the current data supports a multi-decade continuation of oil demand growth.
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