The rise of electric vehicles has prompted many analysts to start trying to pinpoint the year in which global oil demand will peak and start to decline irreversibly in the face of electrification and improved vehicle efficiency. While forecasts range from “in a decade” to “not in your lifetime,” transportation above ground — not the ‘flying cars’ hype, but airline travel — is expected to continue to grow for decades to come.
Air carriers use a middle distillate of oil — jet fuel — and as far as demand for air travel goes, jet fuel demand will be the fastest-growing transportation fuel at least until 2050, because current forecasts by international agencies only try to predict oil demand until that date.
On the one hand, global demand for air travel is set to grow with increased globalization and leisure travel, as well as with the expanding middle class in emerging economies with higher income to spend on business and tourism travels by plane. On the other hand, unlike with EVs, currently there aren’t viable alternatives to jet fuel that are cost competitive and feasible on a commercial scale. So the fuel for growing airline traffic will come from a middle distillate of crude oil.
Airline traffic figures for 2017 are in, and they show high passenger traffic demand, with economic growth picking up globally. Air cargo demand was also strong on the back of robust global demand for manufactured goods.
According to the United Nations specialized agency, the International Civil Aviation Organization (ICAO), a new record of 4.1 billion passengers were carried by the aviation industry on scheduled services last year, up by 7.1 percent compared to 2016. More than half of the world’s 1.2 billion tourists who traveled across international borders in 2017 were transported by air, ICAO said.
source: By Tsvetana Paraskova for Oilprice.com