Global fundamentals

A deep understanding of long-term energy fundamentals underpins ExxonMobil’s business planning.

These fundamentals include energy supply and demand trends; the scale and variety of energy needs worldwide; capability, practicality and affordability of energy alternatives including lower-emission solutions; greenhouse gas emission-reduction technologies; and supportive government policies. The Outlook considers these fundamentals to form the basis for long-term business planning, investment decisions, and research programs.

The Outlook reflects our view of global energy demand and supply through 2050. It is based on current and expected trends in technology, government policies, consumer preferences, geopolitics, and economic development.

What’s the difference between a projection and a scenario?

A projection like the Outlook starts with current factors, such as policy and commercially available technology, and estimates how they might change over time. In contrast, many scenarios start with a hypothetical outcome and work backward to identify the factors that need to occur to achieve that outcome.

How are the Outlook and scenarios being used?

ExxonMobil uses the Outlook as the basis for developing plans. The Company also considers scenarios including the Intergovernmental Panel on Climate Change Lower 2°C and the International Energy Agency Net Zero Emissions by 2050 to help inform its thinking on the resiliency of its assets and the opportunities to evolve its businesses.

How do Scenarios inform?

ExxonMobil uses many scenarios to identify leading indicators of future developments. These signposts allow for timely adjustments to the Outlook.

Society’s progress is intrinsically related to energy. Access to safe, reliable and affordable energy is a critical enabler of higher living standards, including longer and healthier lives. Today a significant portion of the world’s people lack that access, preventing many from realizing their potential. The challenges become even greater considering that the global population is projected to grow to almost 9.7 billion by 2050 from 7.8 billion today.

Improving access to energy and a growing global economy will lead to better economic opportunities, higher incomes and improved living conditions for many. Countries that move up the human development index typically use more energy. Today, more than 40% of the world’s people live in countries that rank low to medium on the U.N.’s human development index¹. Advancing development for that many people creates the potential for significant global energy growth.

¹_{UN Development Programme Website: Human Development Index | Human Development Reports (undp.org)}

• Global population grows to 9.7 billion in 2050 from 7.8 billion today.
• About 65% of this growth is in Africa and the Middle East, more than 25% in Asia Pacific, and roughly 3% in developed countries.
• Efficiency gains reduce energy use per capita in the developed world. The developing world increases its energy per capita in pursuit of higher living standards.
• Global demand is expected to rise 15% by 2050 as developing nations add five times what is reduced by developed countries.

• Economic expansion is a key driver of energy demand. The world economy contracted in 2020 due to the COVID pandemic, then recovered in 2021 to the pre-COVID level. It is now facing significant uncertainties because of high inflation and rising global tension.
• World Gross Domestic Product is projected to more than double from 2021 to 2050, with developing nations growing at more than twice the rate of developed countries.
• By 2050, developing countries will account for almost 55% of global GDP, up from about 40% today. China’s growth from 2021 to 2050 is similar to the growth of the entire developed world.
• The widespread economic expansion among developing nations suggests continued robust energy demand in these economies.

• Access to energy enables economic progress and improves quality of life. As income grows, it enables families to own homes, purchase labor-saving appliances, pursue education, travel, and obtain needed medical treatment.
• As GDP grows faster than population around the globe, average personal incomes rise everywhere, with significant country and regional variations.
• By 2050, China GDP per capita is expected to more than triple to reach about 75% of all developed nations at that time.
• India's per capita GDP is likely to grow even faster than China’s. It will remain below the global average by 2050.
• Africa per capita GDP is expected to add more than 50%, yet in 2050 is still at around 10% of the average of developed countries.

• Even though the average income in developing countries remains lower, there is already a burgeoning middle class that can afford more than the basic necessities of food and shelter.
• Despite the recent impact from COVID, the Brookings Institution foresees continued rapid growth of the global middle class, with billions more people rising out of poverty by 2030.
• Asia Pacific represents the largest growth, with India and China each expected to have more than 1 billion middle-class citizens by 2030.
• The expanding middle class means billions of people will aim to improve their living conditions. Access to energy is a critical enabler for these aspirations.