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Sinopec's Groundbreaking Energy Forecast for 2060

On December 24, 2024, China Petroleum & Chemical Corporation, widely known as Sinopec (HKG: 0386), set a noteworthy milestone by releasing an ambitious global and Chinese energy outlook aimed at 2060. This marks the first time Sinopec has provided such a long-term, detailed assessment of the evolving energy landscape, signaling significant shifts in the dynamics of both fossil and renewable energy sources.

Key Insights from the Forecast

The energy forecast outlines predictions for the world’s primary energy consumption, pointing towards a peak of 26.71 billion tons of coal equivalent by 2045. Notably, renewable energy is expected to account for an impressive 51.8% of total energy consumption by 2060. Here are some critical aspects highlighted in the report:

1. Slower Consumption Growth: Global energy consumption is anticipated to taper off gradually, approaching 25.25 billion tons of coal equivalent by 2060. Oil and gas will constitute approximately 35.7% of the total energy requirements at that time.

2. Peak Oil Demand: Oil consumption is projected to reach its zenith around 2030, with consumption levels hitting 4.66 billion tons. The focus of usage will shift from transportation to industrial feedstocks, and oil is expected to remain the dominant transport fuel, holding 40% of the transportation sector's energy needs by 2060.

3. Rise of Non-fossil Energy: Significant growth is expected in non-fossil fuel alternatives, particularly in hydrogen, Carbon Capture, Utilization and Storage (CCUS), and advanced energy storage technologies. Hydrogen demand is predicted to exceed 340 million tons by 2060, increasing its share of energy consumption from 2% in 2023 to nearly 50% by 2060. CCUS capacity is poised to capture 110 million tons of CO₂ by 2030, expanding to 4.7 billion tons by 2060.

In addition to global perspectives, Sinopec's China Energy Outlook 2060 (2025 edition) aims to capture the trajectory of energy consumption and transition within China:

• - Peak Energy Consumption in China: China’s primary energy consumption is expected to hit between 6.8 and 7.1 billion tons of coal equivalent after 2030. Oil consumption is forecasted to peak at 800 million tons before 2027. There will be moderate to robust growth in natural gas consumption, particularly expected to increase by more than 110 billion cubic meters between 2026 and 2030.

• - Shift to Non-fossil Energy: Projections indicate that by 2035, electricity generation from non-fossil sources could surpass fossil fuel production, reaching 8,400 TWh. The non-fossil energy consumption share is anticipated to rise to 27% between 2026 and 2030. The energy landscape in China will increasingly pivot towards a diversified mix, integrating electricity, hydrogen, ammonia, and other clean alternatives.

• - Carbon Emissions Peak: Energy-related CO₂ emissions in China are expected to rise mildly from 10.66 billion to a peak between 10.8 and 11.2 billion tons. This trajectory aligns with China’s goal to achieve peak carbon emissions by 2030.

Insights from the 2025 China Energy & Chemical Industry Development Report

Sinopec also released the 2025 China Energy & Chemical Industry Development Report, shedding light on recent developments within the energy and chemical sectors:

• - The oil refining capacity in China is nearing its maximum threshold, stabilizing at around 960-970 million tons per year by 2025.

• - The chemical market faces challenges such as overcapacity in the olefin and aromatic hydrocarbon sectors, amid persistently high production levels of bulk chemicals.

• - Driving force for Growth: Innovation is identified as the key driving force for the transition of the energy and chemical industries towards a more sustainable future.

With these comprehensive reports, Sinopec aims to provide policymakers, industry leaders, and stakeholders with invaluable guidance for navigating the challenges and opportunities of the forthcoming decades. The corporation is committed to advancing the energy transition, fostering technological progress, and encouraging sustainable, low-carbon solutions across the energy and chemical sectors.