ExxonMobil warned in its annual energy outlook released on September 17 that global decarbonization progress may fall short of climate goals, projecting coal consumption will decline more slowly than previously modelled.

The company estimates coal will make up 15% of the global energy mix by 2050, falling from 25% in 2025 but one percentage point higher than its prior forecast. Prasanna Joshi, Exxon's director of economics and energy, noted coal remains a major energy source across China and other Asian economies and is considered key for energy security.

The International Energy Agency last week projected global coal demand will hit an all-time high of 8.94 billion tonnes this year, amid supply disruptions to oil and LNG shipments through the Strait of Hormuz stemming from Middle East tensions. Joshi said Exxon's outlook, which guides its capital allocation, excludes impacts from the Middle East conflict, as the long-term market ramifications cannot yet be fully assessed.

"We need a few more years to really understand what the impact is going to be on long-term fundamentals," he commented.

Exxon's updated outlook forecasts annual global energy-related CO2 emissions will drop to 30 billion tonnes by 2050, well above the 11 billion tonnes identified by a UN panel as the threshold needed to cap global warming. This emissions trajectory points to a 2.5-3°C rise in global average temperatures by century-end, according to Joshi. The company's prior forecast had pegged 2050 emissions at 27 billion tonnes.

The oil major also revised down its projection for global carbon capture and storage volumes, cutting the 2050 estimate to 2 billion tonnes from the earlier 3.1 billion tonnes. Its forecast for global oil demand remains unchanged at roughly 105 million barrels per day by 2050, compared with 100 million bpd of consumption last year.

Separately, worldwide electricity demand is seen climbing 65% between 2025 and 2050, largely in line with the prior estimate, driven by industrial activity and rising power use from data centers.