COM - IEA's 2030 Outlook - I Don't Even Know Where To Start

2024-06-13 09:40:15 ET

Summary

• IEA predicts global oil demand will peak by 2030, leading to an 8 million b/d surplus due to Electric Vehicle and energy transition movement.
• IEA's outlook shows a disconnect between GDP growth and oil demand growth, with unrealistic assumptions about EV penetration and gasoline demand drop.
• Despite IEA's flawed projections, there are insights in the report suggesting peak oil supplies this decade, particularly in US shale production.
• We see an oil market that's going to be in a sustainable deficit by 2030.

IEA published its latest 2030 outlook yesterday, and I don't even know where to start. The big headline from the IEA medium-term outlook is that global oil demand will peak by 2030, and oil producers are going to face a surplus as large as ~8 million b/d thanks to Electric Vehicles ("EVs") and the energy transition movement.

For energy investors, this is the greatest confirmation signal you needed. As a golden rule in energy investing, we've learned that fading the IEA has almost always worked. Who remembers IEA's famous call in March 2022 for Russia to lose ~3 million b/d of oil production following the Ukraine invasion?...

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