Artificial intelligence could boost global copper demand by as much as 50% in the years to 2040, which will cause a supply squeeze due to the long lead times on new mines.
That’s according to S&P Global Energy and Market Intelligence, which released a special report on the issue today, warning that the gap between demand and supply could reach 10 million tons by 2040. Total copper demand could soar from 28 million tons in 2025 to 42 million tons in 2040, the S&P Global report’s authors, including Daniel Yergin, said.
The general driver of this higher demand is electrification, the authors wrote, making a special note of artificial intelligence as the newest demand “vector”, which has burst on the scene and stolen the spotlight in just three years.
“In 2025, half of US Gross Domestic Product (GDP) growth is attributed to AI spending – largely on computer chips, data centers, and the electric power systems on which they run,” the authors of the report wrote, adding that “By 2030, data centers alone could rise from today’s 5% to 14% of US electricity demand, with copper a critical enabler all along the way.”
Meanwhile, the biggest “demand vector” identified by the S&P Global analysts remains core economic demand, which covers everything from computers and household appliances to the construction and manufacturing industries. This vector will also be expanding over the coming years.
Of course, the energy transition, which is essentially a transition from liquid fuels to electricity, will also drive demand for copper higher. “Electric vehicles (EVs) require 2.9 times more copper than a conventional car, and the population of EVs is growing,” the report said. “The number of electric cars sold worldwide in 2025 was 25% greater than total new cars sold in the United States, the world’s second largest new car market.”
Wind and solar generation equipment also includes a lot of copper, the authors noted, so the more wind and solar installations get built, the more copper gets used in that segment.
By Irina Slav for Oilprice.com
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