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Current Affairs

COVID-19 effects on global energy sector

Date: 01 May 2020 Tags: Reports & Indices


The International Energy Agency (IEA) has released a report detailing the impact of Covid-19, which it has called a “once-in-a-century crisis”, on global energy demands and CO2 emissions.



With lockdowns imposed in several countries, transportation such as road and air travel has been largely restricted, due to which global energy demands have plummeted.



  • As per the report, countries in full lockdown are seeing an average decline of 25 per cent in energy demand per week, while in those with a partial lockdown, the fall in energy demand is about 18 per cent per week.

  • This may not be a reason to celebrate as it is expected that emissions will soar once economies restart, unless governments take a conscious decision to change the sources of energy.

  • The report estimates that the global demand for oil could drop by nine percent on average this year, which will return oil consumption to 2012 levels.

  • As a result of lockdowns, road transport has dropped between 50-75 percent with the average global road transport activity falling to 50 percent of what it was during this time in 2019.

  • Aviation activity the world over dropped by 60 percent at the end of March 2020. The International Air Transport Association (IATA) expects the flight capacity utilisation to average below 65 percent of what it was in 2019 in the second quarter of 2020, further impacting the demand for jet fuel and kerosene.

  • Coal demand could decline by eight percent, mainly due to a fall in electricity demand of over five percent over the course of the year.

  • In advanced economies, coal demand will fall by 25 percent in the US, 20 percent in the European Union (EU) and 5-10 percent in Korea and Japan.

  • In the coming months, the demand for coal will be impacted based on how its biggest consumers, such as China, recover from the crisis.

  • Regardless of the lengths of global lockdowns or a second pandemic wave, the demand for renewable is likely to increase. Renewable sources of energy have been the “most resilient” to Covid-19 lockdown measures and the total global use of renewable energy is expected to rise by 1 percent by 2020.

  • Emissions declined the most in regions which were impacted the highest by the disease. For instance, there was an 8 percent decline in emissions in China and Europe, and a 9 percent decline in the US.

  • India, which is one of the IEA association countries, has seen a reduction in its energy demands by over 30 percent as a result of the nation-wide lockdown. This translates to a fall in energy demand by 0.6 per cent with every additional week of lockdown.