The charts below are from the International Energy Agency’s fantastic “Net Zero by 2050” report. The sheer breadth, depth, and work in the report boggles the mind. Designed to “…inform the high-level negotiations that will take place at the 26th Conference of the Parties (COP26) of the United Nations Climate Change Framework Convention … in November,” it offers a global pathway to net-zero carbon global emissions by 2050.

We are stunned and grateful for the countless people who toiled to assemble such a remarkable piece of research. We are equally concerned that its message is being misunderstood. We believe it has been used as fuel for the “peak oil demand” view that has become ever more popular since the emergence of Covid. While offering a path to decarbonization, in our view, the report shows just how far we are from actually hitting net-zero targets.

The KCR research team includes a collection of people who are attempting to raise nearly a dozen children. These children range in age from 2 to 17 years of age. Like many parents, we are concerned for their future. Climate change is not something we take lightly. This piece is just what we learned reading the research.

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We hope our work shows that peak oil DEMAND requires a set of unlikely assumptions. We have been consistent in stating that we are not energy experts, far from it.

In a recent CFTC, we showed how “Magazine Covers” had done a remarkable job being a contrarian indicator and was flagging us that oil was a “buy.” In that piece, we discussed how we thought people were over-extrapolating the demand shock from Covid.

Below is the chart from the IEA’s report showing a huge collapse in oil demand. We will do our best to briefly walk through how the IEA gets to these estimates in just a few pages. Summarily our view is that “peak oil demand” views take too much for granted. Further shocks from a resurgent Delta virus will only exacerbate what we believe may be a material shortage of oil supply.

Total Energy Supply in the NZE shows oil demand collapsing

The International Energy Agency: Take-Aways from “Net-Zero by 2050” (NZE Scenario)

The KCR research team is, once again, going to pound the table: we are not energy experts. What follows is our take on the IEA’s “Net Zero 2050” report. We believe advocates of the end of energy causing greenhouse gas emissions, while well-intentioned, may be missing a bigger and more alarming message.

In KCR’s view, the report is designed to say “what people claim to want is possible but immensely challenging” and in no way represents a report heralding the end of oil.

That is just our view, and we will explain why by


That is just our view, and we will explain why by quoting from their report around a few of their charts. For starters, they are not exactly shy about voicing reservations around the assumptions in the NZE report. On page 3 they describe the path to Net Zero as “…narrow and extremely challenging…” with the report setting out over 400 milestones necessary for their low-carbon, climate-neutral path to work.