As the new year approaches and the book on an eventful year in the energy world closes, 2025 looks set to bring more volatility, geopolitical tension and policy evolutions. Elections in almost all major global economies in 2024 have set the stage for a shifting policy landscape next year, most notably in the US, as President-elect Donald Trump outlines his priorities and plans for the incoming administration.
The push for decarbonization continues, but numerous challenges persist, including economic instability, evolving energy demands and infrastructure constraints. As industries adapt to a changing landscape, several trends are emerging that will shape the sector’s trajectory. From shifts in the geopolitical balance to breakthroughs in low-carbon technologies and the increasing influence of artificial intelligence (AI), 2025 presents critical opportunities and risks for stakeholders across the energy value chain.
Drawing on Rystad Energy’s depth of expertise, we are looking into our crystal ball and exploring 12 significant trends that will shape the energy world in the coming year. Each trend offers a roadmap for understanding the forces that will influence global energy strategies in 2025.
We’re moving from a time of energy scarcity to a time of energy abundance. Capacity additions in both fossil fuels and renewables will outpace increases in demand next year. Similarly, in the face of an oversupplied oil market, OPEC+ may need to extend its production cuts far into 2025 to protect oil prices. The era of China driving oil consumption growth is over, with the country’s peak diesel in the rearview mirror, gasoline demand plateauing and coal consumption leveling off, as it is globally.
This is echoed in the electricity market, with 90% of the power consumption growth in 2025 coming from renewables, while nuclear and gas share the remaining 10%. The intermittency of renewable power capacity has triggered record periods of negative prices, intensifying the need for reliable energy storage. As such, 2025 could be a breakout year for energy storage systems.
Total electricity growth in 2025 is expected to be 1,350 terawatt hours (TWh). Data center consumption, now primarily fueled by AI, is likely to grow from 450 TWh in 2024 to 500 TWh in 2025. This equals about 4% of the total electricity consumption growth, similar to the increase from the 20 million new electric vehicles (EVs) expected in 2025.
The new Trump administration will impact domestic and global energy priorities, including pulling any levers available to increase domestic crude production, even though the industry is unlikely to respond to this stimulus. However, President Trump might have more success in accelerating liquified natural gas (LNG) infrastructure investments, the results of which will not be felt for several years. These dynamics underscore the importance of careful navigation as the sector balances short-term challenges with long-term opportunities.Jarand Rystad, CEO and founder, Rystad Energy.
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