IEA's 2025 Outlook Forecasts Later Fossil Fuel Peak

The International Energy Agency released its World Energy Outlook 2025 on Wednesday, highlighting a precarious global energy landscape marked by geopolitical tensions, supply chain vulnerabilities, and a resurgence in nuclear power, while forecasting that fossil fuel demand could peak later than previously anticipated under current policies.

In the report, the IEA outlines multiple scenarios for future energy trends, emphasizing the role of government policies in shaping outcomes. Under the Stated Policies Scenario, which assumes countries implement their announced climate commitments, global demand for fossil fuels is projected to peak within the next decade. Coal use has already reached or surpassed its high point, oil demand is expected to crest around 2030, and natural gas to top out before 2035. However, total fossil fuel consumption will be higher than forecasted last year, driven by surging electricity needs from data centers, air conditioning, and electric vehicles. Renewables are set to expand rapidly in this pathway, with wind power more than doubling and solar generation increasing over fourfold by 2035, sufficient to meet rising demand without further fossil fuel growth.