Transport, industry to buoy fossil fuel use in Latin America, Caribbean

Fossil fuel use in Latin America and the Caribbean (LAC) is forecast to grow 5% by 2035 driven by higher transport and industry demand.

The projection is part of the International Energy Agency’s (IEA) just released World Energy Outlook 2024.

“Fossil fuels continue to play an important role in LAC energy systems. Oil accounts for 60% of current fossil fuel demand in the region, natural gas for 34% and coal for 6%,” the IEA highlights.

The analysis points to Brazil’s position as the third largest contributor to the increase in global oil supply in 2023 and Guyana was in the top 10, while Argentina plans to become a net natural gas exporter in the near term.

Nevertheless, the IEA sees significant potential to electrify the transport and industry sectors and accelerate the deployment of biofuels.

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“Solid bioenergy and biogases are also set to play a critical role in decarbonization in the region, with heavy industries, notably steel and chemicals, increasing their bioenergy demand,” the research contends.

Regarding renewables, “investment in clean energy is increasing, yet it needs to ramp up further to meet the energy and climate goals set by LAC countries… current LAC renewable trends imply that installed capacity of wind and solar PV increases nearly three-times by 2035.”

Read Latin America, Caribbean forecast to add 190GW in renewable capacity

And although many countries in the region have published hydrogen strategies, few projects are moving to the investment stage, according to the research.

Read Why this US hydrogen developer is changing its strategy in Latin America

The IEA’s World Energy Outlook 2024 is available in the Documents box in the top-right corner of the screen.

Outlook for LAC, EJ = exajoules (Source: IEA World Energy Outlook 2024)