According to a report released by Wood Mackenzie on May 12, 2020, demand for crude oil will take until at least 2026 to recover under a full recovery scenario.[1] In its report, Wood Mackenzie examined several trends happening as a result of the pandemic: reduced travel and trade, greater government involvement, and increased automation. The analysts then developed three scenarios for how those trends could affect energy over the next two decades. In the ‘Full recovery’ scenario, there is a rapid return to pre-pandemic conditions. Under the ‘Go it alone’ scenario, economies are slow to recover from the pandemic, with mixed outcomes for coal, oil and natural gas. And finally, in the ‘Greener growth’ scenario, governments focus stimulus programs on supporting the energy transition.

While natural gas use and coal use are expected to trend upward and downward, respectively, across all scenarios, crude oil demand is less predictable. Under the ‘Greener growth’ scenario, for example, oil demand would slowly rebound over the next decade, followed by a sudden decline in 2030 as policies reinforce the energy transition and electric vehicles take hold. In the other scenarios, oil demand slowly increases over the next two decades.

[1] https://www.eenews.net/assets/2020/05/13/document_ew_02.pdf

METI’s Advisory Committee for Natural Resources and Energy released the outline for the 5th Strategic Energy Plan on April 27, 2018. The outline reviews Japan’s progress towards its energy outlook by 2030, which was set in the Long-Term Energy Supply and Demand Outlook[1] published in 2015. The outline also considers Japan’s longer-term vision for energy supply and demand by 2050. The Strategic Energy Plan is the national energy policy that sets the vision and strategies to meet Japan’s long-term energy needs, based on the Energy Policy Act of 2002.

The outline acknowledges the progress made to date since Japan’s current Strategic Energy Plan was enacted in 2014 and pledges to further boost the measures currently in place. Japan will continue to rely on nuclear energy as an important zero-emission baseload energy source, however, the country will reduce its dependency on nuclear energy by promoting energy efficiency, renewable energy, and efficient thermal power generation. According to the outline, Japan expects that 44% of its generation mix will be zero-emission sources by 2030, which it will achieve by re-starting nuclear power plants and increasing renewable energy. Japan will advance its energy technologies, such as IoT, AI, and big data, and will integrate multiple business operators and systems, as part of a plan to enhance energy conservation by 2030. The outline sets several long-term goals to achieve by 2050, such as expanding renewable energy, reducing reliance on nuclear energy, combining advanced technologies to develop high efficiency distributed energy systems, and replacing low-efficiency coal-fired power plants with more high-efficiency coal fired power plants, as part of the process to transition Japan into a decarbonized society.[2]

[1] http://www.meti.go.jp/english/press/2015/pdf/0716_01a.pdf

[2] http://www.enecho.meti.go.jp/committee/council/basic_policy_subcommittee/026/pdf/026_009.pdf