Oil demand to hold above 100 million bpd through 2040, says ADNOC CEO

ADNOC CEO Projects Robust Oil Demand Outlook

Global oil demand is set to remain above 100 million barrels per day well into 2040 and beyond, according to ADNOC's top executive. Sultan Ahmed Al Jaber, the UAE's Minister of Industry and Advanced Technology and Group CEO of Abu Dhabi National Oil Company, shared this projection during recent industry discussions. He highlighted how sectors like aviation, petrochemicals, and emerging industries such as artificial intelligence and data centers will fuel this sustained growth. With the world facing surging power needs and rapid urbanization, traditional energy sources like oil will play a pivotal role alongside renewables and natural gas. Al Jaber's comments come at a time when energy markets are navigating volatility, production adjustments by OPEC+ members, and geopolitical tensions.

The UAE, a key OPEC producer, has positioned itself strongly in this landscape. ADNOC currently boasts a production capacity of 4.85 million barrels per day, with plans to reach 5 million by 2027. This expansion underscores the company's confidence in long-term demand. Al Jaber emphasized that oil's role is evolving, shifting from primarily mobility to essential materials in manufacturing and technology. As 1.5 billion people are expected to move to cities by 2040, the pressure on energy infrastructure will intensify, keeping oil relevant.

Key Drivers Behind the Demand Surge

Several factors are propelling this enduring oil demand. Jet fuel needs are projected to rise more than 30 percent, driven by a rebound in air travel. Petrochemicals, crucial for plastics and chemicals, will see heightened consumption as global economies expand. Meanwhile, the explosive growth of AI and data centers demands massive electricity, much of which relies on reliable energy backups. Cooling systems in hotter climates add further strain. Al Jaber noted that renewables will more than double by 2040, and LNG demand could grow by 50 percent, yet oil holds steady above the 100 million barrel mark. Electricity consumption overall is expected to climb similarly, painting a picture of multifaceted energy expansion.

Urbanization and economic development in regions like Asia amplify these trends. India, in particular, stands out as a powerhouse, with ADNOC naming it its largest LNG market and top LPG supplier. The UAE firm is also partnering on renewable projects there, including 11 gigawatts of solar, wind, and storage capacity. This blend of traditional and green investments shows a pragmatic approach to meeting diverse needs.

"Oil demand will remain above 100 million barrels per day beyond 2040, increasingly used not just for mobility, but more and more for materials. Our response to meet that demand should focus on the data, not the drama. You can't run tomorrow's economy on yesterday's grid."

ADNOC's Strategic Positioning and Investments

ADNOC is gearing up to capitalize on this outlook with low-cost, low-emission production. The company aims to become the world's most AI-enabled energy firm, deploying over 200 AI tools and 65 robotic systems. These technologies monitor wells in real time, predict equipment failures, and optimize output, cutting unplanned shutdowns in half. Such innovations enhance efficiency while minimizing environmental impact. Al Jaber stressed the need for $4 trillion in annual global investments into grids, data centers, and all energy sources to support tomorrow's economy.

On the production front, the UAE has secured a higher output quota from OPEC+, reflecting its investments from 3 million to nearly 5 million barrels per day. While some OPEC+ members like the UAE plan measured increases, others pause amid supply concerns and sanctions on Russia. This balanced strategy aims to regain market share without flooding the market. ADNOC's ties with partners like India further solidify its role in global supply chains.

The company's upstream operations, led by executives like Musabbeh Al Kaabi, focus on delivering barrels that meet rising needs sustainably. By integrating AI across operations, ADNOC not only boosts productivity but also sets a benchmark for the industry. These efforts align with broader goals of energy security and transition, ensuring reliability as demand patterns shift.

In summary, ADNOC's leadership foresees oil demand holding firm above 100 million barrels per day through 2040, propelled by technology, travel, and urbanization. Parallel growth in LNG, renewables, and electricity underscores a diverse energy future requiring trillions in investments. ADNOC's AI-driven, low-emission strategy positions it to meet these challenges effectively.