Foreword from Spencer Dale

Welcome to the 2025 edition of bp’s Energy Outlook

The energy system sits at the heart of modern-day society, critical for the everyday needs of people and businesses around the globe, and adapting to changing political, technological, and environmental priorities.

That central role is why many of us choose to work within the industry.

It is also why the challenges and forces shaping the global energy system are forever changing.

And the past year has been no different.

Geopolitical tensions

Geopolitical tensions, which came to the fore with the war in Ukraine, escalated further with the conflicts in the Middle East and the increasing use of sanctions and tariffs.

Those tensions refocused attention on the importance of energy security. Increasing the priority on delivering secure and affordable energy is likely to affect countries in different ways.

For some, it may mean reducing dependency on imported fossil fuels, and accelerating the transition to greater electrification, powered by domestic low carbon energy. We may start to see the emergence of ‘Electrostates’.

Others may increase the emphasis on domestically produced fossil fuels, and resist increasing their dependency on low-cost international supply chains for low carbon technologies.

Data centres

The seemingly exponential growth in data centres to support the increasing use of artificial intelligence (AI) applications provides an important new source of energy demand, especially in some markets such as the US where growth in power demand over the past decade had virtually stalled.

These changing political and technological factors come against a backdrop of another year of surprising strength in global energy demand: primary energy is estimated to have increased by 2% in 2024 – above the average for the past 10 years.

Energy efficiency

The strength in energy demand is the counterpart to another year of lacklustre gains in energy efficiency, the causes of which are still poorly understood.

I realise that shifting patterns in energy efficiency may seem a little arcane, but I would argue that the sustained weakness in efficiency gains over the past five years was one of the most important factors shaping global energy over this period. In particular, it underpinned the continued steady growth in fossil fuels despite the rapid growth in low carbon energy, led by solar and wind.

Carbon emissions

This year marks the 10th anniversary of the historic COP21 and the agreement of the Paris climate goals. Since then, carbon emissions from energy use and industry have risen every year (other than the Covid-induced dip in 2020). If CO₂ emissions remain around current levels for the next 10 years, the ability of the world to remain within a 2°C carbon budget would become increasing challenging and costly.

What should we make of all this?

Energy Outlook 2025

Readers of previous bp Energy Outlooks will not be surprised that this year’s edition does not attempt to provide any definitive answers or recommendations. But it does present two scenarios – Current Trajectory and Below 2° – which can be used to explore some of the key uncertainties surrounding the future of the energy system stemming from differences in the speed and depth of the energy transition.

And this year’s Outlook also develops three Sensitivities, designed to illustrate the possible implications of some of the other recent issues shaping the energy system: increased geopolitical fragmentation, sustained weakness in energy efficiency, and a growing risk of a delayed and disorderly transition.

One of the benefits of publishing the Energy Outlook is that it contributes to the continuing debate and dialogue about the many issues affecting the energy system. I hope this year’s Outlook is useful for everyone else grappling with these issues. Even more, I hope that you will let us know your views, how they differ to the analysis discussed in the Outlook, and how future Outlooks could be improved.

Spencer Dale

Chief economist
September 2025