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The World Energy Outlook is the International Energy Agency's annual flagship publication that provides long-term projections of energy demand, production, trade and investment, by fuel and by region, under several policy scenarios*. These projections currently extend to 2040.

WEO-2015 presents three main scenarios that are differentiated by their energy and climate policy assumptions, with the future energy picture that they portray varying significantly, and introduces a forth in this latest edition:

  • The New Policies Scenario – the central scenario – describes a pathway for energy markets based on the continuation of existing policies and measures, as well as the cautious implementation of announced policy proposals, even if they are yet to be formally adopted.
  • The Current Policies Scenario only takes into account those policies that were enacted as of midyear 2015, and therefore offers a baseline against which to assess the impact of new policies.
  • The 450 Scenario is an outcome-oriented scenario, illustrating an energy trajectory consistent with a 50 percent chance of limiting the long-term increase in average global temperatures to no more than 2 degrees Celsius (°C), the internationally agreed global climate goal.
  • In addition, WEO-2015 presents the new Low Oil Price Scenario, which assesses the implications of a prolonged period of low global oil prices on markets, policies, investment, the fuel mix, and emissions.

Global energy demand increases in all WEO scenarios, but government policies play a powerful role in dictating the degree of growth and the degree to which energy-related emissions decouple from energy use. Overall, new energy and climate policies – either those that have been announced or those that are prescribed to meet the world’s climate goal – serve to restrain the pace at which energy demand grows and to weaken, or break (in the case of the 450 Scenario), the link between growth in energy demand and in energy-related emissions, a crucial consideration for COP21.

  • For example, World primary energy demand is projected to grow by 45 percent by 2040 compared to 2013 demand in the Current Policies Scenario, 32 percent in the New Policies Scenario, and 12 percent in the 450 Scenario with all of the net growth coming from non-OECD countries and OECD demand ending 3 percent lower in 2040.
  • Shifting to global emissions, the Current Policies Scenario sees the growth in energy related carbon-dioxide (CO2) emissions averaging 1.2 percent per year over the Outlook period, maintaining a broadly consistent pace through to 2040. The growth in emissions is much slower in the New Policies Scenario, but total emissions still fail to peak by 2040. In both scenarios, therefore, the world moves further away from achieving its agreed 2°C climate goal, but at differing speeds. In the 450 Scenario, the long-standing trend of increasing energy-related CO2 emissions is quickly halted and emissions then decline by more than 2 percent per year (on average) to around 19 gigatonnes (Gt) in 2040. 

Moving to oil, markets expect oil prices to head higher as markets work off the current excess supply, but risks remain. The process of adjustment in the oil market is rarely a smooth one, but, in the IEA's Central Scenario, the market rebalances at $89/bbl in 2020, with further increases in price thereafter. Demand picks up to 2020, adding an average of 900 kb/d per year, but the subsequent rise to 103.5 mb/d in 2040 is moderated by higher prices, efforts to phase out subsidies (provided that momentum behind reform is maintained, even as oil prices pick up), efficiency policies, and switching to alternative fuels. Collectively, the United States, EU and Japan see their oil demand drop by around 10 mb/d by 2040. On the supply side, the decline in current upstream spending, estimated at more than 20 percent in 2015, results in the combined production of non-OPEC producers peaking before 2020 at just above 55 mb/d.

Other highlights:

Source: IEA World Energy Outlook, 2015. For detailed discussion see the WEO-2015 publications on IEA web site.

* see the definitions at the bottom of this page

Overview            Regional trends            Oil and gas supply investment            Fossil-fuel subsidies and renewable energy outlook

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