Peak Oil once instilled fear among policymakers, businesses, and consumers as an imminent moment when the world might suck even the last drops of black gold out of the ground, like a straw reaching the bottom of a milkshake.
The idea was popularized in the 1950s by geologist M. King Hubbert, who warned that US oil production would follow a bell-shaped curve and eventually reach an inevitable peak as fields mature and decline.
Climate change has changed the narrative in recent years. Rather than fear a shortage, the debate now focuses on when demand will ultimately peak, as the shift toward electric vehicles (EVs) and other clean energy accelerates.
At the same time, political opposition, from the combustion-engine car ban to the delay in rolling back EV subsidies, is raising doubts about how fast the transition away from fossil fuels will actually happen.
Experts are divided on when demand will peak
Two opposing opinions have emerged regarding when global oil demand will begin to decline.
The International Energy Agency (IEA), a Paris-based body representing major oil-consuming countries, estimates demand will fall by about 102 million barrels per day (bpd) by 2030. World Energy Outlook 2025Published last month, the IEA’s main stated policy scenario assumes that governments pursue ambitious energy and climate targets.
OPEC, the Organization of Petroleum Exporting Countries, takes the opposite view. in your latest long term perspectiveThe oil producer group estimates that demand will continue to grow for decades and will not see a peak before 2050, estimating consumption will reach about 123 million bpd by mid-century.
However, both organizations share an underlying concern: maintaining supply is becoming increasingly difficult. OPEC believes that strong demand growth will justify steady investments from its members to ensure adequate reserves for decades to come. In contrast, the IEA offers a more measured view.
‘Business as usual’ scenario reluctantly revived
Under pressure from the Trump administration, the agency reinstated its more conservative current policies scenario, which was removed in 2020 and is based on current laws and observable trends that fall far short of climate ambitions.
This scenario suggests that supply growth will slow after 2028 as non-OPEC sources such as the United States, Brazil, Guyana and Canada decline. This will make the supply dependent on Middle East OPEC countries like Saudi Arabia, UAE and Iraq.
Meanwhile, the IEA warned that oil demand could rise by 113 million bpd by 2050 if climate pledges are not implemented.
Franziska Holz, deputy head of the department of energy, transport and environment at the German Institute for Economic Research (DIW Berlin), believes that restoring the conservative scenario is a “positive” because it proves that the world is “not on track with our climate goals…”[and] “Replacing fossil fuels in our energy mix is not happening fast enough.”
Holz quipped that “the Americans probably didn’t intend this” when they leaned on the IEA to restore a more cautious scenario.
New oil discoveries hit low
When it comes to peak oil, both organizations point to the same underlying risk: The oil supply will not take care of itself. Older fields are declining rapidly and without steady investment, output from existing sites will fall by about 8% a year, the IEA warned last month.
A large amount of new production is needed to maintain global oil supply. Yet most spending is devoted to offsetting declines from older fields rather than bringing significant new production online.
With discoveries at historic lows and an increasing reliance on rapidly depleting shale and deepwater wells, the oil sector is increasingly racing to stay afloat.
Antonio Turiel, a physicist and peak oil researcher at Spain’s CSIC institute, argues that the US fracking boom, the engine of non-OPEC growth, is already nearing its end. The best drilling locations in the Permian Basin in Texas and New Mexico have been exploited and the rate of decline is accelerating.
“After 15 intense years, we are reaching the end of the fracking road,” Turiel told DW. “We may maintain the mirage for a year or two, but after that the decline is going to be incredibly steep.”
Imminent oil production peak?
Turiel believes the world is approaching peak oil much earlier than most agencies are willing to acknowledge, noting that 80% of all oil fields “have already exceeded their peak production.”
As with shale, he said the world has been too dependent on old supergiant fields for stability, which are about to begin the fastest phase of their decline.
“Most likely, we will start seeing strong annual declines – about 5% annually – even before 2030,” he told DW. “After that point, the gross amount of oil extracted annually is expected to decline by about 50% over 20 years.”
Turiel said an average of 3 billion bpd of oil was discovered from 2020 to 2025 – 12 times less than global consumption. And while OPEC doesn’t expect peak oil and the IEA doesn’t expect a worst-case scenario until 2050, Turiel’s timeline is strong:
“Possibly by 2027, in any case before 2030. Even earlier if some undesirable geopolitical problems emerge.”
Some countries are working on clean energy transition
Despite all the debate about when oil demand will peak, the gap between governments’ climate promises and the policies they are actually implementing remains wide and growing. Only a few countries have created sustainable frameworks to accelerate the transition to clean energy, including Norway’s EV policies, China’s Clean Tech Industrial Strategy, and the EU’s climate legislation.
In contrast, the US under President Donald Trump has moved to expand domestic oil and gas production, weaken federal climate regulations and reduce support for EVs, which analysts say will likely slow the global shift away from fossil fuels.
Jeff Colgan, a political science professor at Brown University, Rhode Island, believes the Trump administration was not only ruining his predecessor Joe Biden’s efforts to support US green industrial policy. More fundamentally, the Trump administration is “attacking” the U.S. government science and institutions that have promoted climate policy, he told DW.
“This will have implications not just for US environmental policy, but around the world,” he said.
Edited by: Uwe Hessler