Market Speaks: IEA says global energy demand set to rise at 1.2% annually to 2035

International Energy Agency (IEA) has stated in its latest World Energy Outlook 2025 (WEO-2025) that global energy demand rose by 1.6% per year between 2015 and 2024. In the currency policy scenario (CPS), the global energy demand increases by 1.2% annually to 2035, adding demand equivalent to that of the United States today. Emerging market and developing economies account for 90% of the increase. After 2035, the annual average increase in demand slows to 0.8%. IEA has noted that countries worldwide are facing unprecedented energy security challenges spanning oil, gas, electricity, and critical minerals. The agency underscores the need for diversification of supplies and stronger international cooperation to ensure stability amid intensifying geopolitical and technological disruptions. The report highlights that electricity now lies at the core of modern economies. Global investment in electricity supply and end-use electrification already accounts for half of total energy investments, reflecting the world’s rapid shift toward what the IEA calls the “Age of Electricity.” Electricity consumption, driven by expanding data centres and AI infrastructure, is rising sharply not only in developing countries but also in advanced economies. The IEA projects that global investment in data centres will reach USD 580 billion in 2025 — surpassing the USD 540 billion projected for oil supply investment.

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