Heightened geopolitical risks, unresolved trade tensions, and policy shifts have added myriad uncertainties to the oil market outlook. Since the start of the year, major economic forecasters have cut their outlooks for world GDP growth in 2025 by roughly half a percentage point to around 2.8% and see a below-trend pace of about 3% annually for the remainder of the decade, with knock-on implications for oil demand. With conflicts in the Middle East region at risk of intensifying and trade negotiations ongoing, uncertainties surrounding our forecasts are substantial.

At the same time, a decision by the OPEC+ producer group, led by Saudi Arabia, to start unwinding oil production curbs in May 2025 is resetting oil supply trajectories over our 2024-30 forecast period. The anticipated output increase from OPEC+ and the impact of higher tariffs on trade pushed oil prices to four-year lows in April and early May. As a result, oil executives are recalibrating investment plans. However, oil prices have since rebounded after an exchange of air strikes between Israel and Iran started on 13 June 2025. With geopolitical and economic uncertainties affecting oil producers and consumers alike, oil supply security remains high on the international energy policy agenda.

Oil markets are going through a fundamental transformation as the drivers of global oil supply and demand patterns shift. Over the past decade, oil market dynamics have been defined by the parallel growth in US oil supply and Chinese oil demand. 

From 2015 to 2024, the United States accounted for 90% of the increase in global supply, with the shale boom lifting US oil production by more than 8 mb/d to over 20 mb/d. At the same time, Chinese oil demand rose by nearly 6 mb/d, accounting for 60% of the global increase in oil use. The picture to 2030 looks very different. Following an extraordinary surge in EV sales, the continued deployment of trucks running on liquified natural gas (LNG), as well as strong growth in the country’s high-speed rail network, along with structural shifts in its economy, Chinese oil demand is on track to peak this decade. For supply, the pace of expansion in US oil production is slowing as oil companies scale back investments but it nevertheless remains the largest contributor to non-OPEC+ growth in the forecast. 

Global oil demand is forecast to rise by 2.5 mb/d from 2024 to 2030, reaching a plateau around 105.5 mb/d by the end of the decade. However, annual growth slows from roughly 700 kb/d in 2025 and 2026 to just a trickle over the next several years, with a small decline expected in 2030, based on today’s policy settings and market trends. This is driven by below-trend economic growth, weighed down by global trade tensions and fiscal imbalances, and the accelerating substitution away from oil in the transport and power generation sectors.

Despite some recent headwinds, global electric car sales have continued their remarkable growth trajectory. They exceeded 17 million in 2024 and are expected to surpass 20 million in 2025, representing around one-quarter of all cars sold, according to the IEA’s Global Electric Vehicle Outlook 2025. This analysis shows that EVs are set to displace 5.4 mb/d of global oil demand by the end of the decade. Substitution away from oil will also feature prominently in power generation during the forecast period – particularly in Saudi Arabia, where displacement of oil burning by natural gas and renewables drives the single largest decline in oil demand for any country through 2030.

As the transport and power generation sectors continue to diversify towards other fuels, the petrochemical industry is set to become the dominant source of global oil demand growth from 2026 onwards. Increased petrochemical consumption is closely linked to the burgeoning supply of natural gas liquids (NGLs). China and the United States lead the build out of petrochemical capacity, at the expense of Europe and other economies in Asia. Globally, the production of polymers and synthetic fibres will require 18.4 mb/d of oil by 2030, or more than one in every six barrels. Demand for oil from combustible fossil fuels – which excludes petrochemical feedstocks and biofuels – may peak as early as 2027.

Robust oil demand growth of 4.2 mb/d in emerging and developing economies over the 2024-30 period contrasts with a continued contraction in advanced economies. Asian markets dominate growth, with India’s expected 1 mb/d increase the largest of any single country by far, though rising oil use in Southeast Asian economies is also significant. By contrast, oil consumption among OECD countries is forecast to decline by 1.7 mb/d through 2030.

While the overall picture for global oil demand is broadly unchanged from last year’s forecast, this masks notable changes among the world’s two largest consumers. China’s total oil consumption in 2030 is now set to be only marginally higher than in 2024, compared with growth of around 1 mb/d forecast previously. By contrast, lower gasoline prices and a loss of momentum in EV adoption in the United States, the world’s largest oil consumer, have led to an increase in forecast oil demand of 1.1 mb/d by 2030 compared with last year’s report. 

The precipitous drop in oil prices in the early months of 2025 and an uncertain investment climate have prompted oil executives around the world to reevaluate their upstream priorities. In addition, after nearly five years of production restraint, the OPEC+ alliance has begun to unwind voluntary supply cuts of more than 2 mb/d that have been in place since 2023. This has put additional pressure on producers outside the bloc to rebalance the market.

Upstream oil investment is set to fall by 6% to around USD 420 billion in 2025, with some of the largest declines in light tight oil in the United States. Investment in conventional projects – both existing and new – is expected to prove more resilient in 2025. Nonetheless, lower oil prices and higher production costs, due to tariffs and inflated costs for essential materials, could mean larger cuts to investment are still to come, while a return to durably higher prices could boost spending.

World oil production capacity is forecast to rise by 5.1 mb/d to 114.7 mb/d by 2030, led by Saudi Arabia and the United States – significantly outpacing the projected 2.5 mb/d increase in global oil demand. Mirroring demand trends, supply capacity growth is heavily frontloaded, slipping from 1.8 mb/d in 2025 to contraction after 2029 as the pipeline of non-OPEC+ projects wanes. 

Global NGL production is expected to increase by 2.3 mb/d to 20.1 mb/d by 2030, accounting for nearly half the total increase in world oil production capacity. A strategic focus on natural gas developments by producers in the Middle East is projected to boost regional NGL supply by 1.4 mb/d to 2030. While independent US producers are set to slow spending, increasing associated gas from the shale patch is expected to buoy US NGL output by 860 kb/d. Biofuel supply gains led by Brazil, India and Indonesia are forecast to add another 680 kb/d by 2030. Crude oil capacity is set to rise by 1.8 mb/d globally, led by the United Arab Emirates (+720 kb/d) and Iraq (+560 kb/d), while the biggest decline comes from Mexico.

Total non-OPEC+ oil supply is forecast to climb by 3.1 mb/d by 2030, despite the number of approved projects tailing off after 2027. The Americas dominate the expansion even though the outlook for US and Brazilian production has dimmed. Combined with a forecast slowdown in oil demand, the call on OPEC+ crude in 2030 is 1.2 mb/d below the average 2025 call. If OPEC+ crude oil supply is sustained at current rates, all else being equal, global oil supply would rise to 107.2 mb/d by 2030, 1.7 mb/d higher than projected demand, suggesting prices would have to drop to prevent an untenable stock build. 

The refining sector is set to be increasingly challenged by demand growth that is underpinned almost exclusively by petrochemicals produced from non-refined products such as NGLs. Global refined products demand is projected to peak in 2027 at 86.3 mb/d, only 710 kb/d above 2024 levels. Thereafter, accelerating declines in gasoline and diesel use outweigh growth in naphtha and jet fuel.

Despite tepid demand growth projections, 4.2 mb/d of new refining capacity is expected globally by 2030, partly offset by 1.6 mb/d of closures. Even so, net capacity growth is set to far exceed refined product demand, with increases in Asia, especially China and India, outpacing shutdowns in Europe and the United States. This indicates that more capacity will have to shut, with high‑cost plants in Europe and on the US West Coast expected to be hardest hit. 

With European and US refining activity set to slow over the remainder of the decade, and with oil supply in the Americas continuing to expand, the Atlantic Basin crude surplus is expected to widen by approximately 870 kb/d to 7.1 mb/d by 2030. Atlantic Basin product exports are poised to rise by 320 kb/d to 3.5 mb/d, as regional demand for refined products contracts more rapidly. Meanwhile, East of Suez refinery activity will not keep up with the rise in refined product demand, marginally widening the product supply gap. Even so, the Middle East is projected to contribute an additional 860 kb/d to global product supply through 2030, further consolidating its role as a key export-oriented refining hub.