By Sabrina Valle
HOUSTON (Reuters) – Exxon Mobil (NYSE: XOM) is bullish on crude oil demand, with projections indicating that demand will remain above 100 million barrels per day (bpd) through 2050. This forecast, which is 25% higher than European rival BP (NYSE: BP), underscores Exxon’s ambitious production growth plans.
In its latest global oil outlook, Exxon Mobil anticipates advancements in technology enabling emissions reductions after 2029, a more optimistic timeline compared to BP’s projections. The company plans to increase production to 4.3 million barrels of oil and gas per day this year, outpacing competitors like Chevron (NYSE: CVX).
Despite the rise of electric vehicles, Exxon believes that global oil demand will continue to grow due to population growth, estimating that even if every new car sold in 2035 were electric, demand would still be 85 million bpd. This contrasts with BP’s forecast of oil consumption peaking in 2025 and declining to 75 million bpd by 2050.
Exxon’s projections suggest that investments in oil will be crucial as the world transitions to unconventional resources, such as U.S. shale. Without new investments, output could decline rapidly, potentially causing oil prices to quintuple and global supply to plummet by 2030.
Analysis:
Exxon Mobil’s optimistic outlook on crude oil demand and the necessity of continued investments in the oil sector highlight the company’s confidence in the future of the industry. Despite increasing focus on renewable energy sources, Exxon’s projections indicate that oil will remain a dominant energy source for years to come.
Investors should take note of Exxon’s growth plans and the potential impact on oil prices and global supply. Understanding the dynamics of the oil market can help individuals make informed decisions about their investments and financial strategies.