In February, we published our fourth Long-term energy market outlook, a comprehensive report that forecasts the prevailing trends within each of the main energy markets through 2040, including a detailed five-year outlook spanning the complete energy spectrum.

Led by Matthew Parry, Head of Long-term at Energy Aspects, the publication is a sophisticated work compiled by our leading experts across the carbon, petrochemicals, power, oil products, refining and supply-side sectors.

Energy market discourse is steadily shifting away from fossil fuels and toward clean energy as decarbonisation takes centre stage. While many governments and businesses are committing to net-zero targets in an aim to make the energy mix greener, our models show that oil demand will peak in the early 2030s. Despite cheaper solar and wind power, a surge in electric vehicles (EVs), and advances in hydrogen fuel and carbon capture technology, our models show that infrastructure constraints will limit the pace of change.

This begs the question of whether the energy transition’s goals are really achievable. How long will oil demand continue to rise? And what will the energy market look like after oil demand passes its peak? 

Matthew Parry answers these pressing questions in the interview below, including the role oil majors will play in the energy transition, the likely headwinds facing decarbonisation and his views on how the energy markets will transform over the next 20 years. 



The Medium-term and Long-term energy market outlooks provide a comprehensive overview of our forecasts for the periods through 2025 and 2040, respectively. The breadth of time covered by these reports means they touch upon a wide range of subjects.

1. If you were to distil each publication into its main takeaways, what would they be?

The Long-term energy market outlook provides a comprehensive — country-by-country, sector-by-sector and fuel-by-fuel — guide to the evolution of energy markets over the next 20 years. Not only do we provide a detailed analysis of all the impending changes that will engulf energy markets through 2040, but we also look at how each change impacts all of the associated Energy types, providing thorough data sets and clear explanations.

Energy Aspects’ Medium-term energy market outlook analyses the specific short- and medium-term transition — i.e. looking at the period through 2025 — tackling how, for example, energy markets will fare in the post-pandemic world and how the energy mix will evolve as emerging technologies, such as EVs, increasingly make progress. The Medium-term energy market outlook (next published in October 2021) also provides a timely update on how the energy market has changed since our last year’s report (published in February 2020), describing, for example, how the GDP outlook has changed and whether the starting point for oil and gas prices is now dramatically different.

2. The reports analyse a broad array of data and trends affecting major sectors in both regional and global economies. How will industry leaders and decision-makers use these reports to inform their market calls and internal deliberations?

These reports give industry leaders and decision-makers a thorough road map for how energy markets will unfold over the next 20 years, allowing them to make timely decisions on how to act today and successfully guiding planning decisions.

3. Governments, industries, and private consumers are all calling for a major push to decarbonise the energy sector and the global economy. What role do you think the oil majors will play as international markets shift toward a greener future?

The energy majors are fully aware of the shifting energy landscape and are acting accordingly to change their future energy mix —increasing investments in renewables and the infrastructure that supports emerging technologies like EVs. Oil will still have an important role to play in the future energy mix, however, as our base case forecast does not show global liquids demand peaking until the early 2030s.

4. This push to decarbonise the global economy will likely face some headwinds. Where do you see these arising, and how do we expect markets will react in turn?

Numerous challenges face the push to decarbonise, ranging from a lack of supportive infrastructure for non–fossil fuel energy growth in many emerging economies, right through to the emergent financial strain that greener technologies, such as EVs, will face as they reach a certain scale.

For example, road financing in many countries is supported by taxes on the sale of gasoline and diesel at the pump, but as EVs increasingly replace the internal combustion engine, these future funds will be depleted, requiring taxation to be applied to all vehicles and thus quickly diminishing currently essential EV subsidies. Furthermore, our recent report, which shows global EV sales rising to around 70 million vehicles per year by 2040, describes the additional resource constraints on the metals required to make EV batteries (particularly nickel and cobalt) prohibitive to achieving faster growth, which will potentially push up costs. 

Also, not all sectors of the global economy can and will decarbonise at the same pace. For example, the industrial sector often requires levels of extreme heat that simple electrification would find incredibly difficult to achieve. Other fuel alternatives — such as hydrogen — will have to play a key role if these sectors are to successfully decarbonise, but these alternatives currently face enormous challenges to be cost competitive with fossil fuels.

Finally, emerging economies, often still hampered by relative energy poverty, will remain dependent upon fossil fuels for longer. Many of these economies not only have less supportive infrastructure for greener solutions, like EVs, but they also depend to a greater degree on more energy-intensive manufacturing for their economic growth.

5. Realistically, where do you see the energy transition ending up? Do we believe that achieving a true net-zero global economy is really possible?

Yes, the energy transition is happening, but due to a combination of sector-specific restraints and a slower emerging market transition, the ultimate pace is unlikely to be as fast as many market commentators think.

6. This report is the culmination of months of effort by team members across many of Energy Aspects' service lines. What were some of the contributions from members of your team, and what was the process like of putting the report together?

The real value in reports like these lie in the numbers, and numbers are where our team of dedicated analysts spend most of their time. Months of work go into not just fine tuning the modelling processes but also clarifying the historical timeseries. We have excellent devoted team members that look at all of the sectors that make up the energy spectrum, ranging from the petrochemicals, power, road, refining and the supply side, and these analysts work night and day to produce the incredibly detailed country-by-country, sector-by-sector, fuel-by-fuel and year-by-year numbers that make up this excellent report.

7. What are some areas of interest you intend to explore in the coming year?

We are adding a lot of work on emissions and carbon prices this year, while building out the scenario capabilities within our models. Together, these additions will give our readers a more nuanced look at the future energy mix. 

8. What brought you into long-term analysis?

I’ve always been most interested in the fundamental forces that influence commodity markets — having specialised in econometrics and advanced macroeconomic theory at university — dynamics that really come to the fore in medium- and long-term analysis. Our demand-side models are underpinned by a combination of our proprietary macroeconomic forecasts, technological developments, changing demographics and environmental pressures, while our supply-side analysis is underpinned by a combination of geological projections, pricing dynamics and technological changes.

9. What gets you up in the morning?

Coffee and the constantly changing news flow.

10. What are you looking forward to most this year (both personally and within your area of research)?

A vaccine, my freedom and the pending recovery in demand.

Want to know more about our Long-term and Medium-term energy market outlooks?
Write to us at sales@energyaspects.com or register your interest here.