From Watts Up With That?

By Neil Atkinson

The International Energy Agency (IEA) held its biennial meeting of energy ministers in Paris last week. Usually, this is a worthy occasion with little accompanying controversy. This time, it was very different. The event was the biggest in the Agency’s history reflecting the growth in its membership in the past decade and the increased scope of its work. The most attention-grabbing aspect of the event was the continued insistence by the U.S. that the IEA change course away from a bias towards advocating climate change policies and particularly from research highlighting the net zero agenda. Energy Secretary Chris Wright has demanded a focus on what we at the National Center for Energy Analytics call “energy realism.” He has gone as far as to say publicly and loudly at the IEA ministerial meeting – with Executive Director Fatih Birol sitting next to him – that if the U.S. is not happy with the IEA’s work, then it will pull out of the organization.

A symbol of the IEA’s pivot towards the climate change agenda was its decision to exclude since 2019 a Current Policies Scenario – i.e., what the energy system might look like if today’s climate policies continue to be implemented but not strengthened – from its highly-respected annual World Energy Outlook. Instead, the main scenarios have been aspirational, assuming that climate policies will be tightened. Since 2021 the IEA has published a controversial Net Zero by 2050 scenario which envisages what the world energy system might look like if the target of net zero emissions by 2050 is achieved. For example, in this scenario global oil demand in 2050 is envisaged to be nearly three-quarters below today’s level. The IEA themselves said in the 2025 edition of the World Energy Outlook that the assumptions of the Net Zero Scenario stretch feasibility to its limits. That’s an understatement.

The IEA’s pivot was based on the Paris Climate Agreement signed in 2015 which called on governments to implement policies that would limit the global increase in temperature to 2°C and preferably to 1.5°C. To achieve this, by now global consumption of fossil fuels should be well on the way to reaching a peak if not having already done so. The problem is that in the real world the consumption of fossil fuels continues to grow, reaching yet another record high in 2025, and is likely to continue to grow for many years to come. This is while investments in non-fossil fuel energies grow strongly. We are in a world of energy addition, not energy transition.

This disconnect between policy aspirations and what is happening in the real world led to pressure on the IEA to reinstate a Current Policies Scenario to more accurately reflect this reality. Late last year in the 2025 edition of its World Energy Outlook the IEA did so. The new CPS outlined a world where oil and natural gas consumption do not peak in the next few years but actually grow all the way out to 2050. Even coal, long slated by the IEA for an early consumption peak, sees consumption in 2050 only slightly below current levels.

Whether this revived Current Policies Scenario is accurate or not remains to be seen, but recent evidence suggests that it is more likely to be accurate than the aspirational scenarios recently favoured by the IEA.

Having made a major change to its scenarios the IEA remains under pressure from the U.S. and other governments – the US is not alone in expressing dissatisfaction with the recent direction of the IEA’s work – to put at the top of its agenda issues of energy security. Of course, at its foundation in 1974 the IEA was primarily an energy security agency. Today, energy security concerns are not confined to interruptions to oil supplies; there is now justified concern about the concentration of power in critical minerals held by China. The IEA has rightly emphasized this risk in its World Energy Outlook and the U.S. has put this issue high on its national security agenda.

At last week’s IEA ministerial meeting, Executive Director Fatih Birol hailed the accession of Colombia – the word’s 12^th biggest coal producer and a significant oil producer – to full membership and noted efforts to bring Brazil, India, and Vietnam into closer cooperation. This is significant because the first two countries are major and growing fossil fuel producers and Vietnam is a fast-growing economy using more and more fossil fuels.

Fatih Birol has repeatedly said that data is the source of all the IEA’s work. Secretary Wright rightly commended the Agency’s record in this respect. We should all support efforts by the IEA to broaden and deepen its data gathering efforts and member governments should ensure that more resources are available to achieve this goal. If further resources are not forthcoming, then the IEA should consider reordering its priorities within its current budget.

The IEA has done much excellent work in the past half century. With demand for all forms of energy certain to grow into the foreseeable future the IEA should have a key role to play in informing global society what is actually happening today and what is realistically likely to happen in the future. The days when aspirational, unrealistic, scenarios were hugely influential in guiding energy investment decisions are over. If the IEA listens to its critics, this will mean that that the U.S. and other governments continue to support it. I hope this is the case.

Neil Atkinson has over 40 years’ experience of oil and energy market analysis in the private and public sectors. Until 2021 he served as the Head of the Oil Industry & Markets Division at the International Energy Agency (IEA) and was responsible for the publication of the monthly Oil Market Report. Previously, he held roles with Petroleos de Venezuela S.A, Platt’s, Oxford Institute for Energy Studies, Energy Intelligence Group, KBC Advanced Technology, Datamonitor Energy and Lloyd’s List Intelligence.

He is a Liveryman of the Worshipful Company of Fuellers in London and a member of the Court. Since 2024 Mr Atkinson has been a Visiting Fellow at the National Center for Energy Analytics, Washington DC. He is based in Paris where he works as an independent energy analyst.

This article was originally published by RealClearEnergy and made available via RealClearWire.